The bullish setup on the HSIF remains valid after the index close at 19,527 pts, ie above the 19,250-pt support.
RHB Retail Research, in a note today (Aug 8), said it opened at 19,524 pts, oscillated between 19,673 pts and 19,363 pts and then closed at 19,527 pts. In the evening, the index fell 115 pts and last traded at 19,412 pts yesterday.
Although the HSIF charted a Doji candlestick with long shadows, it remains above the 20-day SMA line. The short-term moving average line is trending higher, thereby providing support for the bullish trend.
As long as it stays above the 19,250-pt level, the bulls still have the technical advantage.
For the immediate sessions, since the RSI is heading south further – indicating momentum remains weak – there should be a consolidation above the 19,250-pt support.
At this juncture, RHB will maintain a bullish trading bias unless the immediate support gives way.
Traders should stick to the long positions initiated at 19,672 pts, ie the close of 27 Jul. To mitigate the trading risks, the initial stop-loss is set at 19,250 pts.
The immediate support remains at 19,250 pts, followed by 18,545 pts or the low of 24 Jul. Conversely, the immediate resistance is still at 20,000 pts, followed by 20,421 pts, ie the high of 31 Jul.
