The Hang Seng Index Future’s bearish momentum accelerated last Friday as sentiment became risk-off.
After the index opened at 19,932 pts, it progressed lower until it hit the session’s low at 19,273 pts and closed weaker at 19,301 pts.
RHB Retail Research, in a note on Monday (March 13), said after the sharp correction, the index recouped 28 pts in the evening and last traded at 19,329 pts.
The latest price action sees the formation of a Bearish Marubozu and has resulted in the index falling deeper below the 20-day SMA line.
Meanwhile, the 50-day SMA line is turning lower, coupled with the downtrending 20-day SMA line, adding extra selling pressure on the index.
Riding on the bearish momentum, the index should correct towards the 19,000-pt level, followed by the 18,527-pt level.
Premised on the bearish technical signals, the research house holds on to the negative bias.
Traders should keep to the short positions initiated at 21,643 pts (3 Feb’s close).
To mitigate the trading risks, the stop-loss is revised to 20,750 pts, from 21,348 pts.
The immediate support is adjusted lower to 19,000 pts, followed by 18,527 pts (Dec 2022’s monthly low).
Meanwhile, the immediate resistance is revised to 20,000 pts, followed by 20,750 pts.
