The HSIF underwent strong bullish pressure and pushed past the 19,250-pt resistance to close at 19,396 pts yesterday.
RHB Retail Research, in a note today (July 14), said it opened at 18,869 pts, trended upwards throughout the session and closed at the day’s high of 19,396 pts, thereby chairing a Bullish Marubozu candlestick.
In the evening, the index climbed 188 pts and last traded at 19,584 pts. The index has established its position above both 20-day and 50-day SMA lines.
The latest price action confirms that the bulls are in the driver’s seat now. The RSI indicator is curving higher, which implies that the positive momentum should lift the index further in the coming sessions.
Since the bullish setup is in place now, RHB now adopts a positive trading bias.
Traders should close out the short positions (initiated at 18,875 pts, ie the close of 23 Jun) as the stop-loss of 19,250 pts has been triggered.
Conversely, they can initiate long positions at the close of 13 Jul, ie 19,396 pts. To manage the trading risks, the initial stop-loss is set at 18,861 pts.
The immediate support has been revised to 18,861 pts (12 Jul’s close), followed by 18,000 pts. On the flip side, the immediate resistance is now at 19,500 pts, followed by 20,000 pts.
