The Hang Seng Index Futures (HSIF) reversed its recent bearish momentum on Wednesday, settling 179 pts higher at 19,755 pts after bouncing off the immediate support.
The index opened at 19,583 pts and fluctuated positively between 19,372 pts and 19,927 pts, closing at 19,755 pts. In the evening, the index fell by 21 pts and last traded at 19,734 pts.
The bullish candlestick with the upper and lower shadows following the recent downtrend signals a pause in the downward movement above the 19,500-pt immediate support.
However, the rebound may be short-lived, supported by the upper shadow formed in the candlestick, indicating late selling pressure yesterday.
The RSI is still printing below the 50% threshold, indicating that the major bearish momentum may stay in the medium term.
For the immediate term, RHB Retail Research, in a note on Thursday (April 27), said they expect the HSIF to trade sideways above the 19,500 pts support, with strong buying pressure seen yesterday.
RHB’s bearish trading bias is maintained, riding on the 50-day SMA line that is pointing downwards and they advise traders to keep the short positions initiated at 19,924 pts, ie the close of 24 Apr.
To manage the trading risks, the initial stop-loss is placed at 20,800 pts.
The immediate support is marked at 19,500 pts, followed by 19,000 pts. On the flip side, the first resistance is pegged at 20,500 pts, followed by 20,800 pts.
