Williams Sees China as ‘Fallen Angel’ After Japan
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Larry Williams, a trader who correctly forecast the 1982-1987 bull market, said the bear run in Chinese equities may last until at least 2012, based on a benchmark index’s exponential growth followed by steep declines.
The quadrupling in the Shanghai Composite Index between 2006 and 2007 reminds Williams of the Nikkei 225 Stock Average in the 1980s and the Nasdaq Composite Index in the late 1990s. Both the Nikkei 225 and Nasdaq created fallen-angel patterns -- they rose exponentially, then failed to extend their record highs, setting off accelerated declines from which they have since been unable to recover, Williams said.