The HSIF experienced strong selling pressure during Wednesday’s session, declining 144 pts and closing at 16,656 pts.
RHB Retail Research in a note today (Feb 29) said the index initially began trading at 16,803 pts but fell to the day’s low at 16,639 pts before closing at 16,656 pts.
It retraced further by 233 pts in the evening session and last traded at 16,423 pts.
The latest bearish candlestick, coupled with the RSI rounding downwards, shows the negative momentum is regaining its pace.
In the event the index breaches below the 50-day SMA line, it will resume the downward movement.
Towards the upside, we believe a strong resistance exists at the 17,000-pt level.
As long as the index stays below the 17,000-pt level, the house will keep the bearish trading bias unchanged.
Traders should retain the short positions initiated at 16,253 pts (the close of 8 Jan). To mitigate the trading risks, the stop-loss is placed at 17,000 pts.
The immediate support is marked at 16,200 pts, followed by 15,500 pts. Conversely, the nearest resistance remains unchanged at 17,000 pts, followed by 18,000 pts.
