The HSIF continued its profit-taking activity yesterday, falling 288 pts to close at 18,883 pts.
The index began trading at 19,173 pts and tumbled to an intraday low of 18,765 pts before closing at 18,883 pts.
During the evening session, it fell by 245 pts, and was last traded at 18,638 pts.
This marks three consecutive sessions of lower closes, indicating strong corrections ahead, towards the 20-day SMA line.
They expect the corrections to continue towards the first support level at 18,790 pts, with potential further retracement towards the critical support level at 18,200 pts.
The sharp decline of the RSI to 64% supports the near-term price weakness, while the medium-term momentum remains positive.
They expect the medium-term uptrend to resume, supported by the ascending 50-day SMA line.
Based on the medium-term price trend, they maintain their bullish trading bias.
Traders should retain the long positions initiated at the close of 25 Apr (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 – followed by the abovementioned 18,200 pts. The immediate resistance is now at 20,000 pts, followed by 21,000 pts.
