$FTSE China A50 Index - Oct 2023(CN2310)$  

Hong Kong market is closed this morning APAC time due to typhoon. This makes me wondered when Hong Kong can eradicate this problem of market closure as a result of typhoon.

This is creating problems for market participants and liquidity providers which needs the active markets to manage their risks.

Shanghai index came down this morning which is not unexpected given hang Seng tech index weakness last week. Chinext is down too and having breached the 2,000 critical price point mark really makes it worrying for Chinese investors on whether do they want to hold onto their investments..

As you all know, the low can go lower due to extreme fears though true valuation will not be impacted in the short term due to market worries unless this causes a systematic shock to the financial system.

With all these, the gap down from 12,580 which was the last trading price for two Fridays back to today low of 12,181 for china a50 seems to imply lower low of Chinese markets. Unless Chinese authorities can prove that the economy of China is strengthening, it will be very difficult to reinstate confidence in the Chinese economy.

Shortsellers will take every chance to profit from any rebound from lower price to a decent price and then shortsell the stocks on hand. What can China do?

This is not an easy game... confidence building via price strength is not easy when shortsellers kept building on the shorts at higher price.. in fact, the benefits from the strength due to the reduction of stamp duty in China has all been erased since china a50 is around 12250...

Nasdaq 100 futures also broke down below 15k points especially with worries over the heightened pressure arising from the conflict between Israel and Palestine.

I just hope for world peace.

All these uncertainties at least in the current apac morning did not invoke massive fears. I am not so sure of what will happen when Europe markets open later.

Let's watch it later.

As always, this should not be construed as any investment or trading advice.

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