Maintain long positions. The HSIF saw a positive session yesterday, breaching above the 26,500-pt psychological mark. The index began the day session with a 36-pt gap down from the previous evening session – opening at 26,417 pts. After struggling near the day low of 26,366 pts, the HSIF saw huge buying pressure, climbing 278 pts towards the day high at 26,644 pts and breaching the 26,500-pt threshold. After reaching the day high, it dipped to the day low again before settling the day session at 26,555 pts. The evening session was rather neutral, as it closed the session at 26,551 pts with a doji pattern. For the last six sessions, the average trading range narrowed to a mere 300-pt swing – the HSIF needs more consolidation to find a firm footing above 26,500 pts. We will see if the RSI is still tracking an uptrend in the coming sessions. As long as the support level is intact, we keep our positive trading bias.

We recommend traders maintain long positions. We initiated these at 26,177 pts, or the closing level of 13 Nov. For risk-management purposes, we set a stop-loss below 25,920 pts.

The immediate support will remain at 25,920 pts and followed by 25,816 pts. On the upside, the immediate resistance is pegged at the recent 26,644-pt high and followed by 7 Jul’s high of 26,791 pts.

Source: RHB Securities Research - 19 Nov 2020