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Chinese small cap stocks are having a great year in the early going, and I suspect it will get better as the quality survivors deliver their 2011 audited numbers. I thought last year’s audits were under the microscope- this year’s audits will be the most thoroughly performed in the history of audits. In light of all the fraud that was disclosed in 2011, the Chinese auditors are on the hot seat, and they know it.

There are a few major factors pushes these oversold stocks back up the charts.

The Market in Chinese Is ripe.

MBOs:

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