The HSIF experienced strong selling pressure during Friday’s session, plunging 343 pts and closing at 16,515 pts.
RHB Retail Research in a note today (Mar 25) said the index started off the session at 16,852 pts and then progressed lower until it hit the 16,338-pt day low and closed at 16,515 pts.
In the evening, the HSIF remained unchanged and last traded at 16,515 pts.
The latest session saw the index trading firmly below the 20-day SMA line, which shows that the bears now have the technical advantage.
The latest bearish price action, coupled with the RSI rounding downwards, suggests the HSIF is very likely to see a negative momentum follow-through for the immediate sessions.
The index may also retrace to the 50-day SMA line and test the 16,000-pt level.
This correction will continue until the HSIF forms an interim support with a bullish candlestick.
Since the bears are now in control, they make no changes to their negative trading bias.
The house recommend traders to retain the short positions initiated at 16,551 pts, ie the close of 19 Mar.
To mitigate the trading risks, the initial stop-loss threshold is fixed at 17,251 pts.
The immediate support is located at 16,000 pts and followed by 15,500 pts.
On the other hand, the nearest resistance is pegged at 17,251 pts – 14 Mar’s high – and followed by 18,000 pts.
