China Shenhua Energy (HKEX: 1088) met with disappointing downside pressure after prices failed to clear above the immediate resistance at HK$18.72 based on our report dated 22^nd October. Technicals indicate that there may be a return of a short-term bullish upside:   

1. The bullish rebound above support zone 2 is a potential indication of continuous upside.
2. Bullish candle successfully closed above immediate resistance at HK$16.58.
3. A break above Senkou-Span B further improves the probability of an upside rally.
4. Volumes show 2 consecutive appreciation above 20-period moving average.

*Expected timeline of the trade is 5 weeks from the date of report issuance.

CHART LEGEND

Ichimoku Kinko Hyo

Red dotted line = 26 periods Kijun-Sen

Blue dotted line = 9 Periods Tenkan-Sen

Green Line B= 52 periods Senkou Span B

Pink Line A = 26 periods Senkou Span A

Black line = 26 periods Chikou Span. Lagging line