Shanghai Opens Up Nearly 8% . . .

. . . And Then Gives It All Back

Econintersect: Monday traders in Shanghai enthusiastically greeted the opportunity to take advantage of the Chinese government’s determination to support the price of stocks. With what might be the largest intraday surge in history, the Shanghai composite opened with a gap up of more than 7.8% from Friday’s close at 3,687. Read below to find out what happened next.

After opening at 3,974.21 the market sold off all day, at one point in the afternoon reaching a low of near 3,655 before rallying again to above 1% in the green (see second chart below).

Even though this may look like a potential reversal day, when you look at the chart for the past three weeks it may have been wild Monday but not that much different than what has been going on almost every day.

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John Lounsbury