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Chinese stocks hotting up

June 24, 2022

I am using a little poetic licence by drawing in a blue vertical line showing a Coppock buy signal on the KWEB chart. Strictly speaking it is on the turn but arguable whether it has turned higher or not. We will probably know more in July but meanwhile we have two out of three ain’t bad with a broken downtrend line and a golden cross from the moving averages and this is coming after a huge decline. These shares have been in a bear market; that is for sure.

As my chartist friend might have said. This plane has crashed so let’s try and put the wheels back on and get it airborne again.

I am a buyer of Chinese shares and slowly starting to put together a meaningful stake. At the moment they are the best, maybe the only game in town but just as they led the stock market down so they may be going to lead it back up again. We shall see.

I look at the fundamentals when I buy shares but not for long these days. I just need to reassure myself that it is my kind of share, well managed, ambitious, growing, big plans, a 21st century type of business and a large market opportunity. If all those boxes are ticked after that it is all about the charts.

Specifically it is all about my indicators, my 2B (two out of three ain’t bad) and 3B (typically adding Coppock to the mix) to decide when to buy and, at some future date, when to sell.

The killer observation I have made is that it seems to be a rule that while Coppock is rising there is no need to sell – ever. A rising Coppock means a rising share, index, crypto whatever. This is a hugely important piece of information. No doubt Murphy’s Law means that there are still things that can go wrong so always proceed sensibly and with an open mind but even so this feature of the Coppock indicator should be very helpful when it comes to making money.

So which Chinese shares do I like based on my indicators. At the moment it is very much the usual suspects.

BiliBili. BILI Buy @ $27.85

Futu Holdings. FUTU. Buy @ $52.42

Kraneshares China Internet ETF. KWEB. Buy @ $32.22

Li Auto. LI. Buy @ $39.24

Meituan Holdings. 3690. Buy @ $198.10

Pinduoduo. PDD. Buy @ $64.23

UP Financial Holdings. TIGR. Buy @ $4.72

Strategy

It is all about Chinese shares at the moment but that will change as and when other shares start to signal that they are ready to be bought. The name of the game is science, logic, discipline and being on the alert. I am very hopeful that there are exciting times ahead. In a future article I will go more into the nitty gritty of buying using a spread betting account. It really does make so much sense so long as you start small and build from profit; just what I try to do.

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