HSI undergoing selling pressure, RHB Research has retained its short positions on HSI futures (HSIF)
The HSIF charted a fresh “lower low” with “lower high” yesterday, retracing 276 points to close weaker at 18,172 points. It started off Thursday’s session at 18,453 points and after it touched the 18,496-point session high, it plummeted to the 17,954-pt day low before closing at 18,172 points. In the evening session, the index fell 67 points and last traded at 18,105 pts. The latest negative price action shows the index has continued to remain under a correction phase. With the bears gripping the index tightly, it would likely stay below the 18,134-point support and head towards the 17,500-point level. Meanwhile, the RSI indicator has also fallen into the oversold region where a technical rebound may happen. Any attempt of a rebound should be resisted by the 19,000-point level. As the negative momentum is still underway, no changes to the bearish bias.
Traders are advised to retain the short positions initiated at 19,391 points, or the close of 2 September. To manage the trading risks, the stop-loss is placed at 19,455 points.
The immediate support is set at 18,134 points – 16 March’s low – followed by the 17,500-point whole number. The immediate resistance is pegged at 19,000 points, with the higher resistance pegged at 19,455 points, or the low of 3 August.