China is Just About Poised to Break Out

Notwithstanding my previous two posts, keep in mind thesis versus reality is all that matters in the stock market. Perception is reality. And the price action in Chinese stocks the past few weeks is encouraging... iShares Xinhua China 25 (FXI) needs to clear $28 and one can build a case for a technical breakout.

In theory this fits with our thesis of "the world shall lead the U.S." but for now all world markets just seem to be correlated - it's all one big monolith.

I'm not yet long this instrument but we've held it's inverse as a hedge fund a long time and we've cut back a lot of late as it's been quite week (signaling potential strength in what is it is betting against - effectively US listed Chinese large caps)