Hang Seng Index (HSI IND)
The index failed to break above the 50-week (blue line) and 250-week (purple line) moving averages. In addition, the index broke below a short-term bullish trendline and the 20-week moving average (red line). The lower boundary of a triangle pattern (since Dec 16) is playing a
resistance role. The weekly RSI is turning down and is below its neutral level at 50%. The MACD is below the 0-level, while the MACD histogram is narrowing down. We expect the index to continue to consolidate and test the next support at around 23,484 or even 22,519 (May 20 low)
Investors should wait for further consolidation and accumulate at 22,519-23,484 and use 21,139 (Mar 20 low) as a stop to control risk.
Support: 23,484 (overlapped horizontal level since Mar 20) and 22,519 (May 20 low).
Resistance: 250-week moving average (around 25,819), 25,847 (previous top).
Joyce Chan, CMT, CFTe