The HSIF is making a fresh attempt to cross above the 20-day SMA line, climbing 122 pts on Monday to close at 16,074 pts.
RHB Retail Research in a note today (Jan 30) said the index began Monday’s session at 15,955 pts.
At one point, it rose to the day’s high of 16,287 pts, then underwent a retracement in the afternoon to close at 16,074 pts.
In the evening, it declined 236 pts and last traded at 15,838 pts – below the 20-day SMA line (15,976 pts).
For now, the index has formed a strong support at 15,829 pts.
If it stays above this spot, it may try to breach above the 20-day SMA line, and head towards the 50-day SMA line.
However, both SMA lines are still trending lower, showing that the trend remains bearish.
The index will resume its downtrend if it drops below the 20-day SMA line.
Towards the upside, a strong resisatnce will emerge at the 17,000-pt level.
We will stick to a bearish trading bias until the 17,000-pt resistance is breached.
Traders should maintain the short positions initiated at the close of 8 Jan (16,253 pts).
To minimise the trading risks, the initial stop-loss is fixed at 17,000 pts.
The first support is at 15,829 pts – the low of 25 Jan – followed by 15,000 pts.
Conversely, the first resistance is at 17,000 pts, followed by 17,600 pts.
