The HSIF surged 737 pts on 2 Jun to close stronger at 18,887 pts – charting a Bullish Marubozu candlestick.
RHB Retail Research, in a note today (June 6), said the index then followed through on 5 Jun’s session to add 134 pts and closed at 19,021 pts – printing a second bullish candlestick.
The price actions of 2 and 5 Jun shows that strong bullish momentum is in play now. The index may extend the counter-trend rebound to test the 19,250-pt resistance, or attempt to climb above the 20-day SMA line.
Crossing above the short-term moving average line will improve the bullish setup. Since the index has breached the stop-loss point – indicating that the bulls are in control now – RHB shifts to a positive trading bias.
RHB has closed out the short positions (initiated at 19,924 pts or the close of 24 Apr) after the trailing-stop of 18,600 pts has been breached.
Conversely, initiate long positions at the close of 02 Jun, ie 18,887 pts. To manage thetrading risks, the initial stop-loss is set at 18,500 pts.
The immediate support is revised to 18,500 pts, followed by 18,000 pts. Meanwhile, the immediate resistance is pegged at 19,250 pts, followed by 20,000 pts.
