Maintain long positions. The HSIF – buoyed by bullish momentum – rose 314 pts to settle the day session at 29,052 pts. Last Friday, it started the session at 28,720 pts before touching a 28,710-pt low. Buying pressure lifted the index towards the day high at 29,096 pts – it closed at 29,052 pts. Meanwhile, the evening session saw the HSIF continue to edge higher, adding 132 pts from the day session to last trade at 29,184 pts – breaching the 50-day SMA line. As mentioned in our previous note, as long as the index manages to stay above the 20-day SMA line, the moving average will curve higher and provide support to test the 50-day SMA line. Underpinned by the positive momentum, the RSI indicator will trend higher, where the HSIF may test the next resistance pegged at 29,276 pts. While expecting mild profit-taking to happen between 29,276 pts and 29,400 pts, we retain our positive trading bias.

We recommend traders stick to the long positions initiated at 29,071 pts, or the closing level of 20 Apr. For risk management purposes, the stop loss is raised higher to 28,400 pts.

The immediate support is revised to 19 Apr’s low of 28,749 pts, followed by the 28,400-pt round figure. The immediate resistance is revised to 11 Mar’s close of 29,276 pts and followed by the 29,400-pt round figure.

Source: RHB Securities Research - 26 Apr 2021