CHART OF THE WEEK:

A long way since “un-investable”.

China HSI — biggest decline since 2008, among the worst in *60* years.

I shared my concerns this weekend, in Global Markets — Weekly Review 24:

SPECIAL UPDATE ON CHINA (CONTINUED)

A historic run — but has the juice been squeezed, and is it time to STEP AWAY?

Speculative Call Volumes are a big concern here — I don’t like setups like these, and history has shown significant risk in similar conditions.

• After being Bullish on China most of the year, at this point the optimal course of action for me is to significantly reduce allocations, and if a high-volume reversal is seen, cut down all exposure.

• I don’t say this lightly as it’s been an important area of focus, and it could still have long-term upside potential — but managing risk comes first.

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BIG PICTURE:

Chinese Stocks have come a long way since “un-investable”...

• Not long ago (earlier this year), having a Bullish view on China wasn’t considered an intelligent thing to do.

• Now in just the last two days, all the big Wall Street firms are upgrading targets aggressively — and everyone is chasing more upside.

Meanwhile — flashing on my screens, my charts suggest China is again at an important crossroads (link), with enough reasons to rethink the Bullish case for now.

“The stock market is a device for transferring money from the impatient to the patient.” (Warren Buffett)

I *continue* to think there will be plenty of opportunities to re-engage in this big Chinese Bull Market — but TIME and PATIENCE are likely needed to get a better entry point.

Things got way too easy — now comes the hard part.

Meanwhile, there are plenty of markets and opportunities which still grab my attention — and there’s more than enough time left in 2024 for “surprises”.

Onwards and upwards, -MC

Thanks for reading.