How high can the Hang Seng and Shanghei go???

[timvodas]

In 1985, the Nikkei sat at 10,000. 5 years later it sat at 40000, today its at around 16k.

The sky is the limit with China and no one knows when it will end. However, when it does end, it will be just like the Nikkei of the late 80s, today's housing market or the year 2000 nasdaq where the back is broken and no recovery takes place for years or decades.

 

[Cutten]

I think they will keep going up until the Olympics. Then you could get a major "buy the rally, sell the news" trade, similar to the Hong Kong handover in 1997. You will be selling/shorting/put-buying during the point of maximum media & speculative frenzy, at a point of extreme overvaluation.

 

[kiwi_trader]

I like that theory Cutten.

It also goes well with Harry Dent's work on demographics/technology adoption in the main market places for the Chinese growth engine.

And also some less reputable cycle work

 

[Tums]

When they have finished building 87.5% of the highways, bridges, dams, power plants, etc., the market will correct.

 

[gangof4]

Quote from Cutten:

I think they will keep going up until the Olympics. Then you could get a major "buy the rally, sell the news" trade, similar to the Hong Kong handover in 1997. You will be selling/shorting/put-buying during the point of maximum media & speculative frenzy, at a point of extreme overvaluation.

the only problem with the theory is that EVERYONE subscribes to it. when they interview people on the street in China who are buying with both fists, they people say the govt. won't allow the market to fall b4 the olympics, so it's up up and away at least until then. so many Chinese believe that that you are bound to see the retail investor (most of the market) try to front run the olympics sometime next summer. given the cash the govt. has, maybe it won't matter.

all i know is that when everyone thinks something, especially retail investors, it's usually wrong. whether that means that we'll have no pullback next summer or it will come in advance, i have no idea. also depends on to what extent China opens their market to outside investors and whether the long awaited futures market finally arrives.

 

[stock_trad3r]

much much higher

 

[dtan1e]

hang seng index 52,000 !

 

[dtan1e]

in 1997 98 i see this frenzy, now i see it again, never thought i will ever witness it twice in my life !!

 

[Trader KGB]

Take a look at the Hang Seng China Enterprise Index today:

Value 16,396.25
Change +702.590
% Change +4.477%

Not bad, I should watch the futures on IB more closely..