Maintain short positions. The HSIF’s sentiment went risk-off yesterday, and it plummeted 605 pts to settle at 27,879 pts. The index started the day session lower at 28,357 pts, and selling pressure was seen throughout the session. After breaching 28,000 pts, things went jittery and the HSIF dived to a 27,773-pt session low. The day session ended at 27,879 pts. During the evening session, the index last traded at 27,921 pts after touching a session low of 27,758 pts. With the bears now in the driver’s seat, we expect more dowside risks until the HSIF forms an interim low or a long lower shadow. With the RSI now in oversold territory, chances are high that we will see a technical rebound if the index continues to drift lower. We are keeping to our negative trading bias.

We recommend traders stick to short positions – this was initiated at 30,077 pts, or the closing level of 22 Feb. For risk-management purposes, the trailing stop is lowered to 28,300 pts.

The immediate support level revised to the 27,500-pt round figure and followed by 27,000 pts. Towards the upside, the immediate resistance is pegged at 9 Mar’s low of 28,283 pts and followed by the 28,500-pt round figure.

Source: RHB Securities Research - 25 Mar 2021