Chinese Start Looking for the Top in A-Shares

History repeats or at least rhymes? Here's a chart making the rounds today. The blue line is the market since 2001, the red line is since 2009. iFeng: 六大利好集体失效 A股尾盘黑色17分钟真相揭秘

Also this chart, China's GDP growth on the right (red bars), import growth from the 4 largest trading partners on the left (blue line).

Here's a chart of A-shares to GDP ratio. The red line is the average, the other bars show a standard deviation, with the current market valued at 1 standard deviation above the historical average. This is due to the banks stocks and some SOEs still having low valuations. Were they to join in the rally, a full repeat of the 2007 surge could unfold.

If the market follows the 2007 model, it will peak in Q4.

As the above analysis pointed out that if history repeats itself, the current upward move to maintain the time and the great bull market in 2007 similar to, meaning since the upward move since last year, have a chance to peak around the fourth quarter. In fact, it seems quite reasonable, because according to the current A-share market capitalization to GDP ratio increased velocity estimation [4], at the end of the year, the ratio will rise to higher than two standard deviations above the median, which means when the The valuation has become extremely expensive side, if and when the economy is still no significant improvement in earnings performance, A shares upward move will most likely meet top.