Hang Seng Index Futures: Re-Testing The 22,000-Pt Resistance
The HSIF closed on a weaker tone after re-testing the 22,000-pt level yesterday, declining 58 points to settle at 21,791 points.
During the day session, it opened at 21,849 points and oscillated between the session’s 22,025-point high and 21,646-point low before closing slightly below the opening level. Strong buying interest emerged at the start of the evening session.
However, this was short-lived. The index reversed downwards strongly, declining 266 points, and was last traded at 21,525 points. The price action showed that the bulls have lost steam after failing to breach the 22,000-point resistance level.
RHB Research said that selling pressure is expected to persist in the coming sessions, towards the 20,863-pt support level. For the medium term, as long as the index trades above the 20-day SMA line, the uptrend movement remains relevant. Unless the stop-loss level is breached, we will stick to our positive bias.
WTI Crude: The Uptrend Remains Intact
The WTI Crude retreated mildly yesterday as it closed USD0.60 lower at USD121.51 – still above the immediate support level. The black gold began on a positive tone at USD122.43 and briefly touched the day’s high of USD122.72 before reversing the trend downwards. It then fell towards the day low of USD120.79 before rebounding mildly at the close.
Yesterday’s small black body candlestick represented mild profit-taking following the recent bullish momentum. RHB Research said that this implies that the bullish momentum may be renewed in the coming sessions since it did not fall below the USD119.98 support. With that, we still expect the WTI Crude to propel itself northwards towards the USD130.50 resistance in the near term. As such, we stick to our bullish trading stance.
COMEX Gold : Still Moving Sideways Above The 20-Day SMA Line
The COMEX Gold moved on a softer note yesterday – in a sideways direction – after losing USD3.70 to settle at USD1,852.80. The commodity began the session lower at USD1,855.10 and whipsawed between the USD1,857.80 high and USD1,841.90 low, which saw it bounce off its support level strongly to close slightly below the opening level. RHB said that the strong rebound during the later part of the intraday session suggests that buying momentum above the 20-day average line remains intact. The commodity’s sideways movement is in line with our earlier expectations, where the upside bias could be seen in the near term. As such, we continue to keep a positive trading bias.
E-Mini Dow: Bears Back In Control
The E-Mini Dow is set to move in a downwards direction as it sharply fell 626 pts yesterday before closing at 32,263 points – breaching below the sideways consolidation phase. The index initially opened on a positive tone at 32,909 points and attempted to move higher as it hit the 33,110-point day high – but this was short-lived. RHB Research said that selling pressure then started to kick in, which saw the E-Mini Dow falling sharply for the rest of the session – hitting the 32,252-pt day low near the close. Yesterday’s strong selling momentum below the support-turned-resistance level of 32,491 pts suggests the index is set to move further downwards in the immediate- and medium-term outlook. This is also supported by the RSI weakening sharply below the 50% level, coupled with the fresh “lower low” bearish pattern. Since the stop-loss level is triggered, we shift to a negative trading bias.