The HSIF failed to climb above the 17,200-pt resistance and resorted to sideways movements below the resistance yesterday.
RHB Retail Research Technical Anamyser today (Oct 27) said the index started off at 17,128 pts.
After oscillating between 17,235 pts and 16,922 pts, its movement closed at 17,042 pts. During the evening session, the HSIF’s movement rose 94 pts and last traded at 17,136 pts – still below the 17,200-pt resistance.
The price action confirmed that this resistance remains stiff and is blocking the counter-trend rebound. Since the RSI is below the 50% threshold, this shows the momentum is weak and that the index’s movement is likely to extend sideways below the immediate resistance.
Should the selling increase, the HSIF will resume the downwards trajectory to test the 16,500-pt and 16,000-pt supports.
Meanwhile, both the 20- and 50-day SMA lines continue to trend lower, strengthening the bearish setup. Since the index is painting a bearish technical picture, RHB holds on to their negative trading bias.
RHB advises traders to keep the short positions initiated at 19,140 pts or the close of 8 Aug. To manage the trading risks, the trailing-stop is fixed at 18,500 pts.
The nearest support is located at 16,500 pts and followed by the 16,000-pt level. On the upside, the nearest resistance is eyed at 17,200 pts and followed by 17,762 pts, ie the high of 19 Oct.
