Maintain long positions. The HSIF formed a black candle yesterday. It closed at 28,058 pts after oscillating between a high of 28,395 pts and low of 27,865 pts. The market sentiment remains bullish, as the index has continued to stay above the rising 21-day SMA line. From a technical perspective, as long as the HSIF does not negate the bullishness of 27 Dec 2019’s upside gap, there is a possibility the rebound will persist. Overall, we remain bullish on the index’s outlook. Based on the daily chart, the immediate support level is now anticipated at 27,865 pts, ie the low of 8 Jan. The next support is seen at 27,380 pts, which was determined near the midpoint of 13 Dec 2019’s long white candle. Towards the upside, we are eyeing the immediate resistance level at 28,947 pts, ie the high of 3 Jan. The next resistance will likely be at 29,080 pts, or the previous high of 4 Jul 2019. Hence, we advise traders to maintain long positions, since we originally recommended initiating long above the 26,500-pt level on 12 Dec 2019. For now, a new trailing-stop can be set below the 27,865-pt threshold to limit the risk per trade.

Source: RHB Securities Research - 9 Jan 2020