The HSIF extended its negative price action during Wednesday’s session, retreating 60 pts and closing weaker at 17,084 pts – testing the 17,000-pt level.
RHB’s Market Dateline said today (Nov 2) that on Wednesday, the index started off at 17,165 pts. It dipped to the 16,976 pts day’s low before closing at 17,084 pts. In the evening, the index rebounded 73 pts and last traded at 17,157 pts. The bearish price action, coupled with the RSI trending below the 50% threshold, suggest that the negative momentum is in play.
Since the emergence of Bearish Engulfing (formed on 13 October), the index has been on correction – charting “lower highs” with “lower lows”.
Amidst the negative momentum, expect a fresh leg of “lower low”, breaching the 17,000 pts support and testing the lower support at 16,500 pts. Pending the bearish breakout at the 17,000-pt level, RHB holds on to negative trading bias.
RHB advises traders to stay on the short positions initiated at 19,140 pts, ie the close of 8 Aug. To minimise the trading risks, the trailing-stop is fixed at 18,500 pts.
The nearest support is marked at 17,000 pts, followed by 16,500 pts. On the upside, the nearest resistance is pegged at 17,762 pts – 19 Oct’s high – followed by 18,000 pts.
