Maintain long positions while moving up the trailing-stop. The HSIF extended its recent session’s correction phase, ending the latest session 551 pts lower at 25,695 pts – this was off the 25,549-pt low. The negative close also placed the index below the 200-day SMA line and previous immediate support of 25,800 pts – both are negative observations. Should there be further negative price follow-ups in the coming sessions, chances are high that the HSIF will enter into a deeper correction mode – we are looking at the downside breach of 25,500-pt level as the required price signal. Until this happens, we keep to our positive trading bias.

We continue to recommend traders stay in long positions. We initiated these at 25,295 pts, which was 3 Jul’s closing level. For risk-management purposes, a stop-loss can now be placed below 25,500-pt threshold.

We revise the immediate support to the 25,500-pt mark, which is followed by the 25,000 pts round figure. Moving up, the resistance level is now pegged at 26,000 pts – a round figure – and followed by 26,300 pts.

Source: RHB Securities Research - 13 Jul 2020