Maintain long positions. The HSIF rose 79 pts to close at 24,719 pts – above our previous resistance level of 24,648 pts. The index started the day session at 24,586 pts, testing the session’s low of 24,891 pts before rebounding to close at 24,640 pts. During the night session, we saw more bulish price action. The HSIF started the session at 24,620 pts, and managed to close 99 pts higher at 24,719 pts after bouncing between a high of 24,813 pts and low of 24,594 pts. As the 20-day SMA line is curving higher, coupled with the RSI above 57%, we believe the recent bullish traction will prevail – pending the testing of a higher resistance level. Amidst bullish sentiment, the downside support level should hold, in coming sessions. Hence, we maintain our positive trading bias.

We recommend that traders maintain long positions. We initiated these at 23,951 pts, or the closing level of 6 Oct. For risk-management purposes, the stop-loss is revised to 23,981 pts, which was 16 Oct’s day low.

The immediate support is revised to 23,981 pts, followed by the 23,751-pt mark. On the upside, the immediate resistance is eyed at 14 Oct’s day high of 24,805 pts, followed by the 24,898-pt mark.

Source: RHB Securities Research - 22 Oct 2020