April 30, 2010 (Chinavestor) There isn't any overbought China ADR at the moment, technically speaking. Chinese stocks with unusual momentum include China Sunergy Co. (NASDAQ:CSUN), Baidu.com (NASDAQ:BIDU), Yanzhou Coal Mining (NYSE:YZC), WuXi Pharma (NYSE:WX), China Architectural Engineering, Inc. (NASDAQ:CAEI), and to some degree Spreadtrum Communications (NASDAQ:SPRD) and China Medical Technologies, Inc. (NASDAQ:CMED).
Details: Chinese solar stocks advanced strongly on Thursday thanks to two factors. China Sunergy Co. Ltd. (NASDAQ:CSUN) advanced +10.49% - ahead of earnings today. For one, oil prices rose 2.36%, boosting demand for solar products. For two, Germany's submission to release rescue funds for Greece helped the euro, sending the dollar lower. To understand how profound impact the dollar has on the profitability of Chinese solar makers, read: Solar stocks and the dollar.
Shares of Baidu.com (NASDAQ:BIDU) caught fire on Thursday after the company reported 2010 first quarter reports. Not only did Baidu.com (NASDAQ:BIDU) surprise current quarter to the upside but guided 2010 Q2 revenues way above consensus estimates. Despite a $88.49 or +14.24% jump on Thursday, the stock is not overbought! Baidu: Is the $90 jump out of sync?
Shares of China's third largest coal miner, Yanzhou Coal (NYSE:YZC), jumped +9.16% on Thursday as energy prices firmed up. The company reported a blockbuster first quarter with net profit jump of over +180%. Hong Kong listed H-shares of the company (HKG:1171) advanced +8.52% ahead of the bell on Friday, suggesting another spectacular day lays ahead. Yanzhou Coal 2010 Q1 profit doubles.
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WuXi Pharmatech (NYSE:WX) has been virtually flat since April 26, Monday after Charles River Labs (NYSE:CRL) announced plans to acquire the company.
The overbought monitor caught the uptrend in China Architectural Engineering, Inc. (NASDAQ:CAEI). Shares of the company advanced +3.24% on Thursday and has advanced +10% in the last five trading days.
The overbought monitor captured the unusual jump in the stock price of China Medical Technologies, Inc. (NASDAQ:CMED) and the strong comeback of Spreadtrum Communications, Inc. (NASDAQ:SPRD) on Thursday.
Most overbought China stocks
ChinaCast Education (NASDAQ:CAST) fell -4.8% on Thursday and tumbled -8.59% in the last three days. Weakness is not stock but industry specific. Noah Education Holdings (NASDAQ:NED) experienced the very same price curve - see Google finance comparative chart here.
Shares of Sohu.com (NASDAQ:SOHU) fell on Tuesday, a day after the company reported first quarter earnings. While the current quarter was disappointing for investors, the company issued a bullish second quarter revenue estimate. Internet ad stocks up after SOHU bullish outlook.
Jinpan International (NASDAQ:JST) bounced back up on Thursday after a -23% fall the day before - and is expected to trade in a narrow range from here. The company issued preliminary quarterly numbers that sent its stock tumbling.
Stocks of The9 Ltd. (NASDAQ:NCTY) fell sharply in the last two hours of trading on Thursday with heavy volume, suggesting more downside pressure is on the way. The stock isn't oversold yet either.
Most oversold China stocks
Overbought A technical condition that occurs when prices are considered too high and susceptible to a decline. Overbought conditions can be classified by analyzing the chart pattern or with indicators such as the one above. A sharp advance from $15 to $30 in 2 weeks might lead a technician to believe that a security is overbought. Or, a security is sometimes considered overbought when the stock is trading out of its trading envelope and is approaching the theoretical high. It is important to keep in mind that overbought is not necessarily the same as being bearish. It merely infers that the stock has risen too far too fast and might be due for a pullback.
Oversold A technical condition that occurs when prices are considered too low and ripe for a rally. Oversold conditions can be classified by analyzing the chart pattern or with indicators such as the one above. A sharp decline from $30 to $15 in 2 weeks might lead a technician to believe that a security is oversold. Or, a security is sometimes considered oversold when the stock is trading below its trading envelope and is approaching theoretical lows. It is important to keep in mind that oversold is not necessarily the same as being bullish. It merely infers that the security has fallen too far too fast and may be due for a reaction rally.