Hang Seng Index Futures: Bearish Setup Remains Intact

The HSIF staged a rebound during Thursday’s session to close higher at 15,600 pts, but the bearish setup remains visible.

RHB Retail Research in a note today (Feb 2) said yesterday, the index started off at 15,533 pts. It rose to the 15,859 pts day’s high before closing at 15,600 pts.

In the evening, the index climbed 88 pts and last traded at 15,688 pts.

Despite undergoing a positive price action, it still trades below the 20-day SMA line.

Both the 20-day and 50-day SMA lines continue trending lower, showing both the short-term and mid-term trends remain bearish.

The RSI is hovering below the 50% threshold, suggesting the current rebound is weak.

It is very likely that the upside movement will be capped at 17,000 pts.

Post-rebound, the HSIF should resume its downward movement towards the 15,000-pt support level.

Since the bearish setup remains intact, we will hold on to negative trading bias.

Traders should retain the short positions initiated at the close of 8 Jan (16,253 pts). To mitigate the trading risks, the stop-loss threshold is fixed at 17,000 pts.

The immediate support is marked at 15,000 pts, followed by 14,000 pts. Conversely, the nearest resistance remains unchanged at 16,400 pts, followed by 17,000 pts.

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