The China Connection - Market Analysis for Jun 19th, 2013

When I look at the Shanghai Comp pattern vs the SPX, what do I see?

I see a developing massive 2-year bottom pattern on the Shanghai, and a mature, 2-year uptrend pattern topping out on SPX.

This urges me to be long the Shanghai -- via the Morgan Stanley China A Share ETF (CAF) -- and to be very cautious in SPX ahead of the emergence of a potentially painful corrective process.