Maintain long positions. The HSIF tested the 200-day SMA line with a 25,619-pt high before sliding to close 47 pts weaker at 25,460 pts. The latest performance came following the recent sessions’ sharp rebound of more than 1,000 pts off the 24,545-pt low on 20 Aug. The latest negative intraday price reversal was not sufficient to signal a price rejection from the aforementioned SMA line – we see it as possible minor pause instead. We maintain our positive trading bias.

We advise traders to stay in long positions, which we initiated at 25,235 pts, ie the closing level of 12 Aug. For riskmanagement purposes, a stop-loss can be now placed below the 25,000-pt threshold.

Support levels are eyed at 25,200 pts, as well as the 25,000-pt mark, ie a round figure that is also near the 50-day SMA line. Meanwhile, the immediate resistance is eyed at 25,600 pts, which is near the 200-day SMA line. This is followed by 25,788 pts, or the high of 22 Jul.

Source: RHB Securities Research - 26 Aug 2020