Market rebound will likely continue. Today, we analyse the HSIF’s longer-term trend based on its weekly chart. Last week, the HSIF formed a long white candle and hit its highest close in more than nine months – an indication of persistent buying momentum. Last week’s higher close can be viewed as a continuation of the market rebound that began in early Jan 2019. From a technical perspective, the market trend is considered positive, as the HSIF has successfully breached above the 1-year downtrend line drawn in the weekly chart. This also suggests that the bulls may possibly be extending their upward momentum in the coming sessions.

According to the weekly chart, the immediate support is now anticipated at the 28,000-pt round figure, also situated near the lowest point in March. The crucial support is seen at 24,876 pts, determined from the previous low of 3 Jan. Towards the upside, we are eyeing the immediate resistance at 31,544 pts, set at the high of 7 Jun 2018. Meanwhile, the next resistance would likely be at the 33,516-pt historical high.

Overall, we advise traders to stick to long positions as signs of a significant reversal have yet to emerge. Kindly refer to our 5 Apr report for more details.

Source: RHB Securities Research - 8 Apr 2019