It’s time to start watching some of these China stocks.  A lot of these basic economy plays are trading well, but testing a key resistance zone right now.

The Airlines CEA and ZNH trade together.  They’ve wedged for 18 months.  Breakouts above 30 and 42 respectively could lead to rallies to the old highs.

cea

znh

ACH has traded within a falling channel since 2009.  A break here could see a move to the 20s.  That said, this may need to test the 10 week moving average first.

ach

 

BABA has traded very well of late.  As long as it holds in this range, the stock looks good for higher prices.

baba

ZTO is a recent transports IPO that is trying to bottom.  Tuesday it broke a double inside day higher.  If it can follow through and clear the base, we may have seen an important low.

zto


There is a lot to work with here, but undoubtedly these all won’t work perfectly.  It’s interesting that these are mostly pure economic plays.  Throughout this decade, China strength has been largely internet and technology related.

Is this an early positive hint about the Chinese economy?  Time will tell.  This is a subtle change I’ll be watching in the weeks ahead.

Trade ’em well!

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