RHB Investment Bank Bhd (RHB Research) maintained its negative stance on Hang Seng Index Futures (HSIF) despite a sharp rebound, saying the recent rally has yet to invalidate the broader bearish outlook.
The research house said HSIF surged 538 points on Friday to close at 24,701 points, forming a bullish marubozu candlestick that indicated selling pressure had eased. The index had opened at 24,175 points and climbed from an intraday low of 24,019 points to a high of 24,740 points before ending the session higher.
However, RHB Research noted that the benchmark has yet to break above its immediate resistance and key moving average lines. A move above the 20-day simple moving average would strengthen the recovery and could push the index towards the 25,500-point resistance level.
Should momentum weaken, the research house expects HSIF to retreat and retest support around 23,500 points.
As the index has not closed above the revised stop-loss level, RHB Research said it is maintaining its negative bias and advised traders to keep their short positions initiated at 26,367 points on Feb 26.
The stop-loss level has been revised to 26,000 points to better manage trading risks.
According to the research house, the first support level is seen at 23,500 points, followed by 22,800 points, while resistance levels are pegged at 25,500 points and 26,000 points.
