If This ETF Keeps Going Up It Means No Global Recession Is Near

What you are looking at above is one of the major ETF’s for investing in China - ASHR.

I own it, and it looks to be starting a classic stage two bull market, basically in the same position that gold and silver were back in March. The ETF rallied through, and above, its 150 and 200-day moving averages in April and May, pulled back, and so far those moving averages are acting as support. If it clears $25.50 then I’ll take that as strong confirmation that it is indeed starting a new cyclical bull market.

The ETF, closely mimics the Shanghai stock index. FXI is the most popular ETF for China, it is just heavily weighted to a few tech stocks, whereas ASHR is more equally weighted, tracking the CS1 300 Index.

Don’t take your eyes off what happens in China, because this ETF is important. It doesn’t matter if you don’t want to buy it, I understand that, but if the Chinese stock market goes up, it’s economy will grow, and that will be bullish for commodities. It’s had a bear market for almost three years. A rise in China means no global recession is starting this year.

Yesterday, gold dropped about 25 points and silver fell too, closing below $30. After big rallies the past few months, there were sharp drops across the board in various commodities. We have seen profit taking in oil this week after OPEC pledged to maintain it’s production cuts, and a huge drop Tuesday in the Indian stock market after investors took election results there as bad news.