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If You're Tired of Volatility, Take a Look at This Market

By Jeff Clark
Thursday, October 30, 2014

The U.S. stock market isn't stable right now.
As I told you last week, things are changing fast.
The S&P 500 has moved more than 1% in 13 of the past 16 trading days. Stocks have gone from overbought to oversold and back again. Most technical indicators have been flipping back and forth between "buy" and "sell" signals each week.
Many European stock markets are acting the same way. Stocks in Germany, Spain, Italy, and France have been equally volatile. Even Japanese stocks have turned unstable. Hardly a day goes by where the Nikkei Index doesn't move 300 points or more.
So where should investors look for stability today?
If you're looking for steadily rising stock prices in today's market, look no further than China...
Yes, I know how odd that sounds. China is under communist rule. Its market is shrouded in a blanket of fraud and manipulation. It hardly seems like the poster child for safe investing.
But as I've been telling you in these pages recently, Chinese stocks are in a brand-new bull market.
And since the Shanghai Stock Exchange Composite Index (the "SSEC") – China's version of the Dow Jones Industrial Average – broke out of its long-term bear market a few months ago, it has moved steadily higher. Take a look...
You can see that the SSEC has put in a series of higher highs and higher lows since breaking out of its long-term consolidating-wedge pattern (the blue lines) in July.
While the rest of the world's major stock markets are changing direction faster than a hummingbird on caffeine, China's market just keeps plodding higher.
The SSEC has resistance at about the 2,500 level. Once it can get above 2,500, there's a lot of room for China's market to move even higher. The next resistance level is all the way up at 3,100. That's more than 30% above Tuesday's closing price.
So if the recent volatility in U.S. stocks has you looking for calmer markets to invest in, look to China. It's one of the most stable markets in the world right now.
Best regards and good trading,
Jeff Clark

Further Reading:

Steve Sjuggerud says China's government wants stock prices to go higher. "When you look at the big picture, you see a government committed to pushing its local stock market higher – just like the U.S. government did in 2008/2009," he writes. Get all the details here.
"Places like China, Greece, and Russia aren't the most savory places to invest today," Steve writes. But "if you don't at least have these beaten-down emerging markets on your radar, you're making a mistake. They're the best value in the world today." Get Steve's full report here.

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Market Notes
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Market Watch
Symbol Price
S&P 500 1977.76 -0.4% +11.6%
Oil (USO) 31.36 +1.8% -11.4%
Gold (GLD) 117.76 -0.3% -9.3%
Silver (SLV) 16.58 +0.6% -23.6%
U.S. Dollar 85.33 -0.1% +7.2%
Euro 1.27 -0.3% -7.6%
Volatility (^VIX) 15.91 +10.6% +18.6%
Gold Stocks (^HUI) 183.76 -0.8% -24.1%
10-Year Yield 2.33 +2.2% -7.2%

From The Crux
World ETFs
Symbol Price
India (IFN) 26.90 +0.3% +35.4%
USA (SPY) 197.78 -0.3% +13.8%
China (FXI) 39.54 +0.7% +8.8%
Taiwan (EWT) 15.63 +0.6% +9.4%
Israel (ISL) 16.86 +0.9% +8.0%
Canada (EWC) 29.98 -0.5% +4.2%
S. Africa (EZA) 68.34 +0.7% +3.8%
Singapore (EWS) 13.15 -0.3% -1.6%
Japan (EWJ) 11.40 +0.5% -3.4%
S. Korea (EWY) 59.51 +1.8% -7.5%
Lat.America (ILF) 35.54 -0.1% -9.7%
Russia (TRF) 12.03 +0.9% -20.4%

Sector ETFs
Symbol Price
Biotech (PBE) 48.98 -1.2% +36.2%
Semis (PSI) 22.32 +0.1% +29.8%
Health Care (IYH) 138.33 -0.3% +24.9%
Transportation (IYT) 155.45 -0.9% +24.4%
Big Tech (QQQ) 99.50 -0.7% +21.6%
Utilities (XLU) 44.58 -0.4% +18.0%
Defense (PPA) 33.02 -0.2% +15.2%
Real Estate (IYR) 73.66 -0.9% +14.0%
Financials (IYF) 84.75 -0.5% +11.6%
Industrials (IYJ) 102.64 -0.7% +9.5%
Consumer Svcs (IYC) 125.65 -0.3% +9.5%
Basic Mat (IYM) 81.99 -1.0% +7.2%
Insurance (IAK) 47.65 -0.6% +6.8%
Software (PSJ) 36.29 -0.1% +6.8%
Telecom (IYZ) 29.89 -0.3% +3.7%
Water (PHO) 25.44 -0.6% +2.3%
Media (PBS) 24.57 -0.5% +1.2%
Construction (PKB) 21.12 -1.1% -0.6%
Retail (PMR) 34.30 +0.6% -0.6%
Alt. Energy (PBW) 5.84 -0.9% -9.1%