Even though the HSI futures had a mild pullback, RHB Research has maintained ‘long’ positions on it.
The HSIF ended 494 points lower at 20,980 points yesterday as sentiment turned cautious. The index initially started off the session at 21,486 points. After touching the session’s high of 21,512 points, it progressed lower to reach the session’s low of 20,892 pts before the close. In the evening, it surged 177 points to last trade at 21,157 points. Although the index faced strong profit taking activities, it has managed to retain its position above the 20,500-point support – forming a “higher low” bullish pattern. In the event it breaches below the immediate support, sentiment may become weaker and attract further selling pressure. At this stage, the correction is deemed as a mild pullback and expect the index to climb above the 20-day SMA line in the coming sessions. As such, positive bias is being maintained until the stop-loss is triggered.
Traders are recommended to maintain the long positions initiated at 21,474 points, or the closing of 21 June. To minimise the downside risks, the stop-loss is revised to 20,500 points from 20,400 points. The immediate support is formed at 20,500 points, with the subsequent support marked at 20,000 points. Meanwhile, the immediate resistance is still pegged at 21,758 points – 13 Jun’s high – followed by the higher resistance of 22,219 points.
