Maintain short positions as the risk is still tilted towards the downside. The HSIF ended the latest session 201 pts lower at 25,506 pts. The index performed weakly over the latest two sessions after it came in near the 25,183- pt immediate resistance. This suggests chances are high that the index’s over a week-long countertrend rebound has completed, and that its retracement phase could be in the process of extending. Premised on this, we are keeping our negative trading bias.

We advise traders to stay in short positions. We initiated these at 24,212 pts, which was the closing level of 12 Jun. For risk-management purposes, a stop-loss can now be placed at above the 25,183-pt threshold.

We are keeping the immediate support at 24,200 pts, ie near 19 Jun’s low. This is followed by 24,000 pts – a round figure near the 50-day SMA line. Moving up, the immediate resistance is eyed at 25,183 pts, which was the high of 9 Jun. This is followed by 25,743 pts, or the high of 11 Mar

Source: RHB Securities Research - 29 Jun 2020