The research house is holding on its positive trading bias i.e. by maintaining its ‘LONG’ positions on the HSI futures.
The HSIF saw bullish momentum slow down on last Friday, retreating 567 points to close the day session at 21,369 points. After printing a bearish candlestick, the index recouped 271 points during the evening session, and was last traded at 21,640 points. The latest price action confirmed that strong resistance has formed at the 22,335-point level.
The index may undergo consolidation before it can retest the resistance level again. RHB Research expects the bulls to form a consolidation base near the 20-day SMA line. However, if it breaches below the moving average line, this would change the bullish posture and attract further selling pressure. The research house reiterate its positive trading bias until the stop-loss is breached.
RHB Research advises traders to hold on to the long positions initiated at 21,466 points or the close of 17 March’s day session. To minimise downside risks, the stop-loss is placed at 20,872 points. The immediate support is marked at 20,872 points – 18 March’s low – followed by the 20,000-point round figure. The nearest resistance is pegged at 22,335 points – 28 February’s low – followed by 23,272 points, or the low of 31 January.
