Replies to post #63082 on Options Wonderland

[3xBuBu]

4 ETFs Impacted by China’s Bank Reserve Requirements
In an attempt to ease concerns and fears that rising inflation could dampen economic growth, China raised bank reserve requirements for the third time in the last five weeks, influencing the Global X Financials ETF (CHIX), the iShares FTSE/Xinhua China 25 Index Fund (FXI), the SPDR S&P China ETF (GXC) and the Guggenheim China All-Cap ETF (YAO) -- see further descriptions below.

The Chinese Central Bank raised the reserve requirement ratio by 50 basis points after earlier data showed a rise in property prices for a third straight month; an increase in both exports and imports; significant increases in M2 money supply; and jumps in new lending by financial institutions, despite government efforts to stem the flood of liquidity into the nation’s economy.

This move by the central bank, which takes effect on December 20, effectively reduces the amount of money China’s banks have available to lend, and aids in decreasing money supply, which further helps fight inflationary pressures.
http://seekingalpha.com/article/241163-4-etfs-impacted-by-chinas-bank-reserve-requirements

[Fox13]

The short term watch shows a substantial differences between the SPX and RUT during the last week.
Here, they are presented as TNA versus SPY. However, they both suggest that a short term correction is possible: a surprising drop on close for TNA and bearish ascending wedge on SPY, supported (so far) by the mid-envelope line: