After a rejection at 20,000 pts, the HSIF underwent a follow-through in negative momentum and fell by 423 pts to close at 19,489 pts yesterday.
RHB Retail Research said today (May 18) that it opened at 19,919 pts, printed the day’s high of 19,953 pts before trending downwards to the day’s low of 19,454 pts before closing. In the evening, the index recouped 191 pts and last traded at 19,680 pts.
The negative price action has led the index below the previous support of 19,500 pts.
After the bearish breakout, the HSIF may test the next support of 19,000 pts. Meanwhile, both 20-day and 50-day SMA lines are trending downwards, thereby strengthening the bearish setup.
Based on this bearish momentum, RHB sticks to their negative bias.
Traders should stick to the short positions initiated at 19,924 pts or 24 Apr’s close.
To manage the trading risks, the initial stop-loss is set at 20,800 pts. The immediate support has been revised to 19,000 pts, followed by 18,500 pts. Conversely, the nearest resistance remains at 20,000 pts, followed by 20,500 pts.
