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Comment For China Stock Market 2016/07/20

The weakness of China stocks continued for the fifth day in a row with SHA declined about 0.29%.Money outflowed from Non-ferrous Metal, Mining and Finance sectors the most.Yanbian Shixian Double-Deer Industrial Co.,a paper producer, rallied to limit-up as brokers recommended the sector as the profit could show some improvement in the mid-year filings. CNYUSD posted the biggest gain since June 29th as more investors believed that China gov will defense the 6.7 line, despite the weaker than expected Europe Econ data sent the DXY higher.In commodity market, soybean meal , cotton and egg continued to decline with weather perspective improved in US crop regions, and hot and dry weather in Midwest concerned seems can only last for one week and investors still believe that the yields could be raised higher than the current USDA number for soybean. As clearly the SHA lost the momentum since Brexit, we suggest investors to reduce the positions further, mind the risk of downside and get ready for SHA to dip below 3000 very soon.

Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.