Hang Seng Index Futures (HSIF) came under pressure on Thursday, prompting RHB Investment Bank Bhd (RHB Research) to flag weakening bullish momentum while maintaining its long position on the index.
HSIF shed 362 points to close at 25,548 points after opening at 25,904 points. It climbed to an intraday high of 25,911 points before sliding to a low of 25,398 points and ended at the bottom of the day’s range, forming a bearish candlestick.
The weakness continued into the evening session, with HSIF falling another six points to last trade at 25,542 points.
RHB Research said the decline points to weakening bullish momentum as HSIF moves closer to its 20-day short-term moving average. The Relative Strength Index (RSI) is also trending lower, suggesting that bearish pressure is building.
Should the correction continue, the index could test support at 24,200 points. However, RHB Research said a rebound could emerge around that level as the broader bullish structure remains intact.
The research house recommended traders maintain the long position initiated at 24,657 points based on the July 15 close.
RHB Research will maintain its positive trading bias as long as HSIF remains above 23,500 points, with the level also serving as the stop-loss threshold to manage downside risks.
The immediate support levels are at 24,200 points and 23,500 points, while resistance is seen at 26,000 points followed by 26,750 points.
