The HSIF pulled back 15 pts on Monday to close lower at 18,268 pts but held on to the bullish technical setup.
RHB Retail Research (RHB) in a note today said that on Monday, the index began trading at 18,285 pts.
After whipsawing between 18,450 pts and 18,166 pts, it closed at 18,268 pts.
In the evening, the index climbed 194 pts and last traded at 18,462 pts.
The price action shows the bulls are taking a breather and the index is resorting to sideways movement below the 18,500 pts resistance.
RHB observed the 20-day SMA line is pointing upwards, showing the short-term trend remains bullish.
The RSI is also trending upwards above the 50% mark, showing the bullish momentum is still in play.
Since the technical setup remains bullish, the index may attempt to break past the 18,500-pt resistance level post consolidation.
If a breakout happens, this will attract fresh buying pressure.
At this juncture, RHB will stick to the positive trading bias.
They advised traders to stay on the long positions initiated at the close of 19 Sep (18,059 pts).
To manage the trading risks, the initial stop-loss threshold is set at 17,300 pts.
The first support locates at 17,700 pts, followed by the lower support at 17,300 pts.
On the upside, the immediate resistance is eyed at 18,500 pts, followed by 19,000 pts.
