The iShares China Large-Cap exchange-traded fund (FXI) holds the 50 largest large-cap Chinese stocks that trade on the Hong Kong exchange. FXI could soon make a secondary test of its 2022 low. A successful test will show strength, but a failed test will show weakness. Either outcome can produce a meaningful directional move offering multiple trading opportunities. This is the kind of setup or juncture around which I like to build agnostic trading plans. Either way, I will have a trading and risk management plan in place to take advantage of either outcome. In a macro sense, there isn’t much going on in China, leading me to optimism. China is a command economy run by a communist regime in the process of retreating from capitalism. Importantly, leadership seems to be increasingly resistant to providing adequate fiscal stimulus. To that list, you can add a rapidly aging population, a world increasingly…
