Slope of Hope Blog Posts

This is the heart and soul of the web site. Here we have literally tens of thousands of posts dating back over a decade. These are listed in reverse chronological order. You can also click on any category icon to see posts tagged with that particular category.

Vulnerability Intensifies For China’s Shanghai Index

By -

Price action on the following monthly chart of China’s Shanghai Index has been under the bearish influence of a very long-term downtrending Andrew’s Pitchfork channel since it peaked in October 2007 and bottomed the following October.

After a weak attempt to break out above this channel at the end of January of this year, it retreated and is currently dropping early Tuesday morning following President Trump’s latest threats several hours ago to impose tariffs on an additional $200 billion worth of Chinese goods in connection with their recent trade war. It has broken below its near-term major support level of 3000 that I had identified in my posts of April 9 and February 16.

If this index returns to its channel “median,” it’s in for one heck of a plunge! Look for a break and hold below its last swing low at 2638.30 to continue its current downtrend on this monthly timeframe. It’s already in downdrend on the weekly and daily timeframes following its failed channel breakout attempt and the momentum indicator is firmly in downtrend on all three timeframes. (more…)

A Bull in a China Shop

By -

Following is the opening segment of this week’s edition of Notes From the Rabbit Hole, NFTRH 504. For months now we have been tracking a divergence in the key cyclical Semiconductor Equipment segment (I am short AMAT & LRCX) to the broader Semi sector (ref. the most recent article from May 18th here) and this week we put more context to the divergence.

A Bull in a China Shop

In light of the developing trade war between the US and China, let’s review the all-important Semiconductor sector and in particular, the Semi Equipment segment, which is a key economic early bird (and canary in a coal mine).

Various sectors took hits on Friday as Trump moved forward with Tariffs on China. But most of those sectors and industries are follow-on aspects of the economic cycle, which got its start when the early bird chirped in early 2013.

With China in Trump’s crosshairs and China a very key player in Semi Fab Equipment, there is a fundamental reason that the Equipment companies are faltering. From SEMI by way of a post at nftrh.com in March.

“SEMI predicts Samsung will lead the pack in fab equipment spending in both 2018 and 2019, even though it will invest less each year than in 2017. By contrast, China will dramatically increase its year-over-year (YOY) fab equipment spending for the next two years – by 57 percent in 2018 and 60 percent in 2019 – to support fab projects from both overseas and domestic companies. The China spending surge will thrust it past Korea as the top spending region in 2019.” (more…)

Israel’s Tel Aviv 125 Index Poised for a Rally

By -

As Israel prepares for the relocation of the US Embassy from Tel Aviv to Jerusalem on Monday, the Tel Aviv 125 Index (TA125) appears to be poised for a rally.

Price closed on Friday just above major support of 1325 and is trading in between the 50 and 200 moving averages, as shown on the following daily chart.

A break and hold above the 50 MA at 1337, along with a rise in the RSI above 50 and further strength in the MACD and PMO indicators, could see price retest 1400, or higher. The higher swing high on the RSI is hinting of further strength. If such a scenario were to materialize, it’s important that the 50 MA remain above the 200 MA, lest we see a bearish Death Cross form, followed by selling. (more…)