Hang Seng Index Futures : Sharp Corrections Ahead

The HSIF is poised for sharp corrections ahead after tumbling 436 pts on Tuesday before closing 29 pts lower at 19,171 pts yesterday.

RHB Retail Research in a note today (May 23) said the index began trading at 19,200 pts and oscillated between 19,352 pts and 19,125 pts, ultimately closing slightly below the opening level.

During the evening session, the HSIF fell by 136 pts and last traded at 19,035 pts.

This latest negative sentiment following the initial pullback observed on Tuesday signals short-term profit-taking activities ahead.

They expect the corrections to persist towards the 19,790-pt first support in upcoming sessions before potentially retracing further towards the 18,200-pt next support, which is supported by a declining RSI.

The medium-term outlook remains positive, given that the index is trading above the 50- and 200-day SMA lines.

Based on the medium-term outlook, they maintain their bullish trading bias.

Traders should retain the long positions initiated at the close of 25 Apr or 17,342 pts.

To manage the trading risks, the stop-loss threshold is set at 18,200 pts.

The immediate support is set at 18,790 pts – 13 May’s low – and followed by the abovementioned 18,200 pts.

The immediate resistance is now at 20,000 pts and followed by the 21,000-pt level.

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