FXI: Didn't Get The Message

Aside from being on the wrong side of the market with my current S&P500 index short trade, there are several other things that have me puzzled about the market's ascent. One of these conundrums is the i-Shares FTSE Xinshua/ China 25 (symbol: FXI).

We last looked at FXI on January 27, 2010, and we identified the $42 level as resistance, and as you can see from figure 1, a weekly chart of FXI, this area remains resistance. Several reasons why this chart should be troubling for equity bulls: 1) FXI has not made new highs while the US indices have; 2) China led the markets out of recovery finding a bottom in October, 2008, which was several months before the US found its footing, so could China (and by proxy FXI) be leading the markets lower?

Figure 1. FXI/ weekly

I know stocks only go in one direction, but some former Indian chiefs (i.e., the FXI) are not cooperating.