Breached 22,219-Point Resistance, HSI Futures Scaling Up on Strong Momentum

RHB Research has retained its ‘long’ positions on HSI futures.

The HSIF extended its uptrend for a fourth consecutive session yesterday, rising 175 points to close at 22,371 points. The index opened at 22,171 points. Initially, sentiment was cautious and the index fell to the day’s low of 21,894 points due to profit-taking activities. Then, in the afternoon, it rebounded to print the day’s high of 22,413 points before registering a strong close. In the evening, the index fell by 240 points and last traded at 22,131 points. The latest price action saw the index climbing above the recent high of the 22,219-point resistance. Amidst strong momentum, the HSIF should scale upwards towards 22,800 points, then 23,200 points.

While the public holiday (on Friday) is looming ahead, the research house does not discount the possibility of profit-takings – but the 20-day SMA line is expected to provide downside support. Meanwhile, the index is firmly on track on its upward trajectory, printing “higher highs” with “higher lows”. As such, no change to the research house’ bullish bias.

Traders are recommended to keep to the long positions initiated at 21,474 points or the close of 21 June. To protect the
downside risks, the initial stop-loss level is set at 20,500 points. The immediate support has risen to 21,500 points, followed by 21,000 points. Towards the upside, the first resistance is set at 22,800 points, followed by the 23,200 points.

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