The HSIF resumed its upward movement on Monday, climbing 498 pts to close stronger at 18,802 pts. Yesterday, the index gapped up and opened at 18,590 pts.
RHB Retail Research, in a note today (Sept 5), said it then progressed higher throughout the session, touching the day’s high at 18,898 pts before closing at 18,802 pts. It retraced 83 pts in the evening session and last traded at 18,719 pts.
The latest “higher high” indicates the index is gaining positive momentum as it has crossed above the 20-day SMA line and is eyeing to cross the 50-day SMA line.
Rising above both the moving average lines will further strengthen the counter-trend rebound momentum. However, expect strong resistance to emerge near the 19,500-pt level.
For now, the Bearish Marubozu remains intact as the bears still possess the technical advantage. During this counter-trend rebound phase, RHB holds on to their negative trading bias.
Traders should retain the short positions initiated at 19,140 pts, or 8 Aug’s close. To minimise the trading risks, the stop-loss is set at 19,500 pts.
The nearest support is revised to 18,500 pts, followed by 18,000 pts. Meanwhile, the nearest resistance is pegged at 19,500 pts, followed by 20,000 pts.
