The HSIF resumed its downtrend on Friday, and shed 108 pts to close at 19,599 pts.
RHB Retail Research said, in a note today (May 15), that last Friday, it opened at 19,706 pts and tested the day’s high of 19,869 pts before retreating in the afternoon.
It underwent a correction towards the day’s low of 19,547 pts, before closing in negative territory. In the evening, the index further declined 178 pts and last traded at 19,421 pts.
The latest negative price action saw the index attempting to close below the 19,500-pt support. If this happens, it will lead to a fresh “lower low”, and attract further selling pressure – which would drag it towards the 19,000-pt level.
So far, RHB notes that the index has been charting a series of “lower highs”, showing that the bears are gaining strength.
Towards the upside, the 20,000-pt level has become the latest resistance.
With the bears having a stronger hold on the HSIF, RHB makes no change to our negative bias. Traders should maintain the short positions initiated at 19,924 pts or the close of 24 Apr. To minimise the trading risks, the initial stop-loss is set at 20,800 pts.
The immediate support remains at 19,500 pts, followed by 19,000 pts. Towards the upside, the nearest resistance is set at 20,000 pts and followed by 20,500 pts.
