RHB Investment Bank Bhd (RHB Research) has maintained its negative trading bias on the Hang Seng Index Futures (HSIF) after the contract extended its decline on Friday, with technical indicators pointing to strengthening bearish momentum.
The research house said HSIF fell 203 points to close at 24,888 points after opening at 25,071 points. The index briefly climbed to an intraday high of 25,289 points before reversing course and sliding to a low of 24,852 points amid persistent selling pressure.
Weakness continued into the evening session, with the futures contract declining a further 344 points to 24,544 points, bringing it closer to the key support level of 24,500 points.
RHB Research noted that the broader downtrend remains intact, with both the 20-day and 50-day simple moving average (SMA) lines continuing to trend lower, adding further downside pressure on the market.
The research house also highlighted that the Relative Strength Index (RSI) is rounding downwards, signalling that negative momentum is gaining traction and increasing the likelihood of a break below immediate support levels.
“Should the HSIF climb above the 20-day SMA line, market sentiment may improve. However, as long as the index remains below 26,600 points, the bearish outlook remains intact,” it said.
RHB Research advised traders to maintain short positions initiated at 26,367 points on Feb 26, while retaining a stop-loss level at 26,600 points to manage risk.
The first support level is pegged at 24,500 points, followed by 23,500 points. On the upside, immediate resistance is seen at 26,000 points, with stronger resistance located at 26,600 points.
