China stock markets are crashing.
Huge bear attack on China Market.
China's stock market crash is just the beginning.
These are a few of the headlines lately, grabbing the attention away from the Greece turmoil.
How bad?
On 5 June 2015, the Shanghai Composite Index hit an all time high of 5000. One month later, it crashed 30% to 3500.
What else?
As of today, approximately 45% of China's market cannot be traded (companies have called for trading halt). Should the suspension be lifted, one could only wonder how much more beatings the market will take.
Ripple effect
This is felt in the various Asian market. Hang Seng index had wiped out 2015's gain. Singapore's Straits Time Index fell close of 1.67% today. It is not clear the immediate impact on our market, but I guess its safe to say there'll be volatility in the near term.
Looking at the chart above, it looks like the strong support would be near 3250. However, if the Chinese were to head for a full deleveraging, it would seem that it'll hit 2500 instead.
I'm sitting on the sidelines with my warchest. I'm going to let the madness slowly unfold before dipping into the market. Meanwhile, it's time to start tabulating my list of stocks and monitor them with their target price.
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