Maintain long positions. The HSIF ended higher yesterday to form a white candle. It rose to a high of 24,343 pts during the intraday session, before ending at 24,209 pts for the day. Given that the index has managed to recoup most of the previous day’s losses, this suggests the upside move is not over yet. Moreover, the 10-day SMA line is still pointing upwards, suggesting additional buying momentum may be present in the coming sessions. Overall, we keep our positive view on the HSIF’s outlook.

As seen in the chart, we anticipate the immediate support level at 23,500 pts – this is situated near the midpoint of 6 Apr’s white candle. If a breakdown arises, look to 22,560 pts – near the low of 2 Apr’s “Hammer” pattern – as the next support. On the other hand, the immediate resistance level is seen at 24,600 pts, ie near the high of 8 Apr. The next resistance will likely be at 25,750 pts, which was determined near 11 Mar’s high.

Therefore, we advise traders to maintain long positions, since we originally recommended initiating long above the 22,300-pt level on 25 Mar. At the same time, a trailing-stop can be set below the 23,500-pt threshold to secure part of the profits.

Source: RHB Securities Research - 10 Apr 2020