RHB Research has maintained short positions on HSI futures.
The HSIF gained 42 points last Friday to close September at 17,210 points. It opened at 17,160 points, then oscillated between 17,362 points and 17,043 points before closing. In the evening, it ceded 11 points and last traded at 17,199 points. The latest session saw the index printing a “higher low” but with a “lower high”. The price action shows that the bears still dominated the session, albeit with a moderation in selling pressure. Meanwhile, the Bearish Marubozu (formed on 28 Sep) remains in effect, and the 20-day SMA line is trending lower. The technical picture indicates that the index is still within the correction phase. As such, it is expected the further downside risk to test 17,000 points, followed by the 16,400-point level. Any attempt of a rebound may take the index towards the 17,650-point immediate resistance. As the bearish set-up remains intact, no change to negative bias.
Traders should hold on to short positions initiated at 19,391 points or the close of 2 September. To manage the trading risks, the stop-loss is fixed at 18,000 points.
The immediate support is marked at 17,000 points, followed by at 16,400 points. On the flip side, the nearest resistance is
set at 17,650 points, followed by 18,000 points
