Chinese stocks have surged as Beijing promised to take strong "counter-cyclical" measures to boost China's struggling economy. China's leaders promised on Monday to increase policy support and boost domestic consumption, as the post-Covid recovery was slower than anticipated.
According to state news agency Xinhua, the politburo meeting emphasised that it is "necessary to actively expand domestic demand, give full play to the basic role of consumption in driving economic growth, expand consumption by increasing residents' income."
The report expands by saying that "It is necessary to boost the consumption of automobiles, electronic products, and home furnishing, and promote the consumption of services such as sports, leisure, and cultural tourism."
In response the CHN50's EMAs crossed bullishly, and its RSI popped above 50. The EMAs will need to develop angle and separation and the RSI to hold above 50, for the index to build upside momentum:
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Russell Shor joined FXCM in October 2017 as a Senior Market Specialist. He is a certified FMVA® and has an Honours Degree in Economics from the University of South Africa. Russell is a full member of the Society of Technical Analysts in the United Kingdom. With over 20 years of financial markets experience, his analysis is of a high standard and quality.