There were no changes to the KraneShares Dynamic China Rotation Model this week, as each of the holdings continued to maintain sufficient relative strength against the Chinese fixed income representative.

The past week has seen continued movement to the upside for the KraneShares MSCI China Environment Index ETF KGRN, which pushed higher last Friday to give its second consecutive buy signal in June at $46.50, before rising to $47. This fund saw a sharp drawdown beginning in late February that ran through most of May, but has moved significantly higher in recent weeks to arrive at a recent fund score posting of 4.83, besting the average emerging market equity fund (3.59) as well as the average Chinese equity fund (2.58). This favorable fund score is also paired with a positive 2.83 score direction, which provides further indication of the consistent recent appreciation of KGRN. The overall technical picture remains sound, however, the recent improvement has led the fund into overbought territory so those looking to add exposure may consider easing in at current levels or waiting for a pullback/normalization of the trading band. Initial support can be found on the default chart at $43.50. Note that the fund is currently positioned at near-term resistance at $47. Further overhead resistance from here may be seen at the all-time high of $55 from February.

The table below is a review of important technical data on a select group of KraneShares ETFs. Significant changes within the past week are highlighted in Green if positive or Red if negative. This portfolio is designed to be used as a "radar" screen to bring your attention to potentially important technical changes that may require your attention and potential action. When evaluating the Fund Score, the strongest issues have scores of 4 or higher while those ETFs with scores below a 3 are no longer considered solid citizens.

The distribution curve places each ETF on a bell curve according to their respective degrees of overbought or oversold status using a 10-week distribution. ETFs that are statistically oversold will appear on the left-hand side of the bell curve, while those that have become statistically overbought will appear on the right-hand side of the bell curve. Perhaps the most useful attribute of this feature is that it displays the entire universe on the curve at one time to give us a general picture of whether the KraneShares ETF universe is generally overbought on a near-term basis, or generally oversold. Our best opportunities are to buy strong relative strength ETFs that have regressed back toward mean conditions based on market weakness, or have become oversold based upon extreme market weakness. Weekly Distribution is a short-term gauge that is most helpful in timing entry and exit points, while the longer-term information of trend and relative strength is a more controlling factor in the decision of whether to buy or sell.

Average Level

5.83

						KEMQ
						KBA
				kfyp		KMED	KURE
			KWEB	kall	kccb	KEMX	KARS			KGRN
<--100	-100--80	-80--60	-60--40	-40--20	-20-0	0-20	20-40	40-60	60-80	80-100	100->

Legend:

• UPPERCASE indicates that the RS chart is on a buy signal.
• lowercase indicates that the RS chart is in a sell signal.
• GREEN lettering indicates the ETFs trend chart is on a buy signal.
• RED lettering indicates the ETF is on a sell signal.
• Box Color indicates the Sector Status Rating. Green = Favored, Yellow = Average, and Red = Unfavored.

The KraneShares Dynamic China Rotation Model is designed to identify major themes in the Chinese marketplace through the use of the Point & Figure relative strength tools. For more information on the portfolio construction and back testing, see the model info file on the models page.  (Note: The KraneShares ETF Models will be updated Tuesday mornings by 9:30 am EST) 

Weekly Changes: 

* - Dates prior to 10/15/2019, which is when the KraneShares Dynamic China Rotation Model became available on the NDW Research Platform, are representative of when the position was added to the backtested model.