The HSI futures has been tumbling down for the past few days. Stop-loss triggered; RHB Research has initiated “short” positions on HSI futures.
The HSIF sliped below the 21,000-point support yesterday to close at 20,836 points. After the bearish session on Monday, sentiment was negative during Tuesday’s session. The index started off at 21,280 points, but selling pressure dragged it lower throughout the session, hitting the day’s low at 20,797 points before the close. The latest bearish session also saw the index close below the 50-day SMA line. Coupled with a fresh “lower low” and “lower high” pattern, the bears are in control now. For now, the 20-day SMA line will act as an immediate resistance. As long as the Bearish Marubozu, formed on 11 July, remains intact, the index will undergo a correction. It may retrace towards 20,473 points, followed by the 20,000-point level. Since the index has breached the stop-loss with a bearish setup formed, the research house is shifting over to a bearish bias.
The research house has closed out the “long” positions initiated at 21,474 points (21 June’s close) after the stop-loss at 21,000 points was triggered. Conversely, initiate “short” positions at the closing of 12 July, ie 20,836 points. To manage the trading risks, the initial stop-loss is set at 22,000 points.
The immediate support is revised to 20,473 points – 14 June’s low – followed by the 20,000-point round figure. Meanwhile, the immediate resistance is shifted to 21,506 points (6 July’s close), with the higher resistance at 22,000 points.
