HSCEI (CHNComp) rallied 2.5% today and was one of the best performing indices during the Asian session. Tech-heavy index benefits from an improved sentiment towards Chinese tech companies as authorities in the country seem to be easing their crackdown on the sector. Media reports saying that Chinese regulators approve new video games after a long break or that they are looking to end a probe in ride-hailing company Didi Global support Chinese tech.
Taking a look at the CHNComp chart at the H4 interval, we can see that the index halted a recent correction in the first half of May and launched a recovery move. Index gained over 17% since then and is closing in on a resistance zone in the 7,700 pts area. This zone limited upward moves during a recovery following a February-March sell-off, spare for a brief false breakout at the beginning of April. A break above would pave the way for a test of the next resistance in line – zone at 8,100 pts.