China investors with longer-term horizons may want to refrain from rushing in to buy this week’s bounce, as history shows the real bottom may still be a way off.
Encouraging commitments from the nation’s financial officials to bolster market stability have driven the Hang Seng Tech Index up 30% in two days, while the mainland’s CSI 300 Index has gained about 7%. Based on recent experience, some traders are waiting to see whether or not this will be just a short-lived rebound.
The events of the past couple of days bring back memories of the bumpy road out of a bear market a bit more than three years ago, when confidence was shattered due by deleveraging and the US-China trade rift.
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