The HSIF’s uptrend was halted at the 20-day SMA line, with the index shedding 277 pts before closing at 18,304 pts.
RHB Retail Research, in a note today (Sept 4), that on Thursday, the HSIF began the session at 18,375 pts. At one point, it rose towards the day’s high of 18,614 pts but ceded intraday gains and fell to the day’s low of 18,265 pts before the close.
Friday’s session saw the index last trading at 18,304 pts when the session was called off due to bad weather.
Thursday’s price action saw the index charting a bearish candlestick with a long upper shadow – indicating the bears have the upper hand in the session.
Coupled with the Shooting Star, this affirms that the 20-day SMA line is acting as a strong resistance now. The RSI has started trending downwards – indicating the negative momentum is re-accelerating now.
Since the correction on the index is resuming, RHB will maintain a negative trading bias.
RHB recommends traders hold on to the short positions initiated at 19,140 pts or 8 Aug’s close. To manage the trading risks, the stop-loss is adjusted to 19,500 pts from 20,000 pts.
The immediate support is marked at 18,000 pts, followed by 17,539 pts, ie the low of 22 Aug. Conversely, the first resistance is pegged at 18,500 pts, followed by 19,500 pts.
