China’s top leaders warned of assets bubbles at July’s politburo meeting, but the real estate market has just become crazier since then. Regulatory climate is becoming tigher now, not only in real estate market, but also in insurance industry and shadow banking sector, as well as in stock market. Investors think it is impossible for the central bank to loosen monetary policy in short term.
Besides, the rising expectation on FED interest rate hike and reignited expectations on Yuan’s depreciation also add uncertainties to the market. So it seems unlikely to see the market establish a clear trend in short term and downward risk may accumulate. 20-day moving average and upward trend line since June 24 is a key support while 250 day moving average as the tough resistance.