Contracts on the Chinese HSCEI Index (CHN.cash) are rising by nearly 7% today, as the market anticipates that the blow from the 104% tariffs on China will boost hopes for Chinese stimulus. Investors expect that China will feel compelled to support financial market sentiment by adopting an ultra-loose monetary policy and possibly introducing a broader aid package aimed at stimulating domestic household demand — something they have avoided for months to prevent risking higher inflation.
If Chinese businesses are paralyzed by the trade war, it seems reasonable to expect that China will take steps to stabilize the situation through various economic interventions, which could at least temporarily lift market sentiment. High-level talks between U.S. and Chinese delegations regarding tariffs are also scheduled for today. The improved sentiment on Chinese markets may partly stem from hopes for a partial rollback of U.S. tariffs.
CHN.cash (D1 timeframe)
Today’s rally has stalled at a key resistance level — the 200-day EMA (red line) and the 38.2% Fibonacci retracement of the upward move that began in early 2024. If negotiations with the U.S. do not result in a reduction of tariffs today, we could expect a downward impulse in CHN.cash and a partial erasure of the gains. On the other hand, if the U.S. softens its policy and maintains only partial tariffs, the Chinese market could benefit, as conditions for economic stimulus would improve. Domestic Chinese companies, in particular, could gain in such a scenario.
However, it is important to consider that a hit to China’s economy could trigger a financial shock and further deepen the problems in the real estate and banking sectors. Today’s rebound also appears to be partly supported by the activity of Chinese state-owned funds, which may be buying up Chinese assets to limit the declines.
The key resistance currently stands at 7,600 points, while major support levels are located around 6,700 and 6,550 points, where previous price reactions have occurred.

Source: xStation5
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