Shanghai Index (SSEC) chart analysis

Since the early July low, Shanghai index rallied ~800 points or 33% and then corrected ~400 points in matter of 5 months.  The index has spent last week consolidating in the tip of triangle shown in the chart below.

Interestingly, SSEC experienced almost identical rally and correction from Nov 2008 to March 2009, 800 points rally followed by 400 points correction.  If history repeats itself, we should expect upside breakout in very short term, and an 1400 points rally will ensue.  However, don't jump to that conclusion quickly, as the situation are quite different between March 2009 and now.  In March 2009, the S&P 500 was at 667, NASDAQ was at 1268, VIX index was at 50 level; right now, S&P is more than 80% higher, NASDAQ more than 100% higher, and VIX index is at 18 level. 

Investment community likes to take Shanghai Index as leading indicator nowadays, however, it's likely that Shanghai could take US stock market as leading indicator as well.  So it's possible that history will repeat itself, but I would be very cautious to long equities right now.