Chinese equities posted modest gains over the past week. China also hosted its annual CCTV New Year’s Gala, a showcase of the nation’s cultural and technological achievements. This year’s program highlighted advanced robotics, with several robots performing complex acrobatic routines—an illustration of China’s continued progress in high‑tech innovation (source: chinalastnight.com).

On the policy front, developments in U.S.–China tariffs drew market attention. On Friday, the U.S. Supreme Court struck down the President’s reciprocal tariffs on China, ruling that the administration exceeded its authority by using the International Emergency Economic Powers Act (IEEPA) to bypass Congress (source: the budgetlab.yale.edu). The decision signaled limits on executive power and provided a measure of relief for Chinese equities, which have faced modest pressure early in 2026. We continue to monitor global policy shifts and their implications for the market. This week, we highlight:

The KraneShares SSE STAR Market 50 Index ETF (KSTR) provides exposure to the 50 largest, most liquid technology and high-growth companies listed on the Shanghai Stock Exchange and includes key sectors like semiconductors, information technology, and among others. KSTR reversed back into Xs against the market last month and maintains a strong fund score of 5.56, with score direction of 1.61. The fund completed a double top at $20.50 and still trades near all-time highs. KSTR continues to build on its 42% return in 2025, as the fund is up over 13% year-to-date. Long exposure can be made here. Initial support is at $19.75, with additional support at $17.25. Initial resistance can be seen at $22.

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.

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.