Whipsaw price actions near the psychological level of 20,000 point is expected, while a negative trading bias for the time being. Hence the research house is maintaining ‘short’ positions on HSI futures.
The HSIF was under great selling pressure on Monday, plunging 796 points and settling at 19,809 points. It recouped 134 points during the evening session and last traded at 19,943 points. The latest price action
confirmed that the bears are having a technical advantage during this correction phase.
As mentioned in the research house’s previous note, it expects the HSIF bulls to defend the 20,000-point level – also expects whipsaw price actions near the psychological level in the coming sessions. In the event the negative momentum continues, the index will retrace towards 19,424 points. An immediate resistance on the upside is pegged at 20,708 points. For now, the research house is still holding on to their negative trading bias.
Traders should stick with the ‘SHORT’ positions initiated at 21,129 points, i.e. the close of 11 April. To minimise the trading risks, the stop-loss mark is adjusted to 21,595 points – 14 April’s high – from 22,000 points. The immediate support is revised to 19,424 points or 14 March’s low. This is followed by 18,134 points, which was the low of 16 March. Conversely, the first resistance is sighted at 20,708 points – 25 April’s high – and followed by 21,129 points, i.e. the close of 11 April.
