“Long” positions being maintained by RHB Research on HSI futures.
After it went through a volatile session, the HSIF closed lower at 21,705 points. Positive sentiment led to it opening at 21,815 points, before it trended north to test the day’s high of 22,169 points. However, sentiment turned cautious in the afternoon, and the index ceded the intraday gains, retraced to the day’s low of 21,690 points then closed in negative territory. In the evening, it retreated by another 74 points and last traded at 21,631 points. The latest price action printed a candlestick with a long upper shadow, which suggests that the 22,000-point level has become a strong resistance. If profit-taking activities are extended, the index may drop below the 20-day SMA line towards the 50-day SMA line. The research house holds the view that the 50-day SMA line will be the last defence for the bulls. Breaching below the medium term moving average line would indicate that a bearish structure is forming. For now, the research house is still holding on a bullish bias until the stop-loss mark is triggered.
Traders should maintain the long positions initiated at 21,474 points or the close of 21 June. To protect the downside risks,
the stop-loss is marked at 21,000 points. The immediate support is at 21,500 points, followed by 21,000 points. Conversely, the immediate resistance is now pegged at 22,000 points, followed by 22,413 points or the high of 28 June.
