xiaosi 

Market manipulation on this type of scale is not new, anyone ever heard of the Plunge Protection Team? Then there's the old favorites for long term manipulation, Bond buying by the central banks. I can understand why they're doing this, allot of China's non-urban residents have been the ones buying the top, they want to avoid civil unrest...

They also want to avoid that whole problem of listed companies who took out loans using their own stock as collateral.

It's hard to use conventional TA to analyze China market.
I'd say it's still in bull market, and it will be much higher than current level a year from now.

Amazed to see that no-one has really answered the question as to why this is happening. It does have a basis in Reckless lending however the real problem is the shadow economy in China.

As many of you guys might know every country has a shadow economy the produces huge amount of revenues for individuals and the government alike however the activities are frowned upon.

In China the shadow economy focuses on 2 things.

1. Large scale lending for irrelevent property invesments.

As of 2014 approximately 80% of New build properties in China for the previous year were unoccupied.

The government has illegally subsidised large construction firms to build property to try and create jobs for 'the greatness of China' Last year they started to curtail their lending but upon doing so have found that These large corporations have so much power they can now maniplulate the publics perception of the Market and are therefore forcing the hand of the lenders.

2. The Banks themselves have been up until now been making huge amounts for lending under these government schemes and when the government asked them to stop lending they looked at their profit margins and basically said fck off.
The government has lost control of the banks and in losing control they have allowed this reckless shadow lending to continue at the detriment to a number of the other industries.

The conclusion is that we will fairly soon see a large interest rate slash so that the communist regime can retake control of the countries finances. Pushing huge numbers back into poverty and huge jobs cuts.

' And everyone who hears these words of mine and does not do them will be like a foolish man who built his house on the sand. 27 And the rain fell, and the floods came, and the winds blew and beat against that house, and it fell, and great was the fall of it'

amarno1 

Amazed to see that no-one has really answered the question ...

Perhaps you should read the other posts next time before repeating others with your 2cts