Hong Kong Hang Seng Index

Hang Seng gained 374 points today to close at 23,896 which is about 1070 points below its November 2010 high of 24,964. Once this level is crossed, mega wave B will be extended and Hang Seng is likely to reach 30,000 level to form a 'Double Tops' reversal pattern.




From its October 2007's peak to March 2009's low, Hang Seng has completed 5 waves, and because the rebound since the low is of such a big magnitude, the March 2009's low has to be major wave A and the subsequent rebound has to be major wave B. The only question is when will it end or whether it has already ended in November 2010.



If Hang Seng is unable to break its November 2010 high of 24,964, it will go all the way South as shown above.

However, if in the next few days it is able to break 24,964 level, the wave count will be as shown below. Hang Seng is likely to head for 30,000.



If Hang Seng is going for extension, Dow is likely to hold for a while to enable Hang Seng to finish its last run up. The last run can be very bullish designed to trap all the small fishes.


.