Hang Seng Index Futures: Falling Below The 20-Day SMA Line

The HSIF fell below the 20-day SMA line yesterday to close lower at 16,551 pts – breaching the 16,600-pt support.

RHB Retail Research in a note today (Mar 20) said the index opened at 16,758 pts and, after touching the 16,778-pt day high, it retraced to the 16,483-pt day low and closed at 16,551 pts.

In the evening, the HSIF recouped 78 pts and last traded at 16,629 pts.

They believe the bears will possess the technical advantage as long as the index stays below the 20-day SMA line.

The correction may drag the HSIF towards the next support at the 16,000-pt mark.

Meanwhile, the RSI is rounding downwards, which indicates that momentum is decelerating.

Since the index has breached the stop-loss point, we shift to a negative trading bias.

They have closed out the long positions initiated at 16,616 pts or the close of 11 Mar.

This was after the stop-loss threshold at 16,600 pts was triggered.

Conversely, they initiate short positions at the close of 19 Mar, ie 16,551 pts.

To manage the trading risks, the initial stop-loss level is set at 17,251 pts.

After the bearish breakout, the immediate support is adjusted to 16,000 pts and followed by 15,500 pts.

Meanwhile, the immediate resistance still pegged at the abovementioned 17,251 pts – 14 Mar’s high – and followed by the 18,000-pt mark.

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