With the weak momentum shown in HSI futures, RHB Research has called for maintaining “short” positions on this futures.
The HSIF resorted to a sideways consolidation yesterday, after falling 222 points and closing at 20,663 points. The index began Wednesday’s session at 20,892 points. After touching the day’s high of 20,896 points, it retraced towards the day’s low at 20,575 points before closing in negative territory. In the evening, it recouped 93 points and last traded at 20,756 points. The RSI has fallen below the 50% level, suggesting that the momentum continues to be weak. Although the bullish reversal pattern of the One White Soldier remains active, the index is likely to move within the range of the 21,000-point resistance and the 20,285-point support. A new trend will be formed once the index breaches either boundary. While the index is consolidating sideways, the research house is keeping to its negative bias for now.
Traders should retain the short positions initiated at 20,836 points, or the closing level of 12 July. To manage the trading
risks, the stop-loss is set at 21,000 points.
The immediate support remains unchanged at 20,543 points – 14 July’s low – followed by 20,285 points. Meanwhile, the
immediate resistance is kept at 21,000 points, followed by 21,506 points, which was the close of 6 July.
