On Tuesday, the HSIF experienced mild selling pressure, pulling back 157 pts and closing at 20,302 pts – still consolidating below the 50-day SMA line.
RHB Retail research, in a note today (April 6), said the index initially opened at 20,470 pts and rose to the day’s high of 20,555 pts before retracing to the day’s low at 20,159 pts and closing in negative territory. In the evening session, the index managed to recouped 119 pts and last traded at 20,421 pts.
The latest price action showed both the bulls and bears sharing equal strength.
However, the index is still trading above the 20-day SMA line, hence, over the short term the technical setup remains positive.
The index should be moving sideways for the coming sessions, consolidating while attempting to cross above the 50-day SMA line.
In the event the selling pressure increases, it may retreat to test the 20-day SMA line support.
As long as the index stays above the stop-loss point, RHB keeps to the positive trading bias and advise traders to retain the long positions initiated at 20,481 pts (the close of 31 Mar).
To manage the trading risks, the initial stop-loss is set at 19,500 pts. The immediate support stays at 19,500 pts, followed by 18,846 pts ie the low of 20 Mar. Towards the upside, the immediate resistance remains at 20,750 pts, followed by 21,750 pts.
