Maintain long positions. The HSIF saw bullish momentum picking up pace again yesterday, rising 31 pts to settle at 26,141 pts. During the week’s first trading session, it opened flat at 25,996 pts. After dipping to the 25,886-pt day low, it climbed above the 26,000-pt level to the intraday high of 26,193 pts. It retreated mildly in the afternoon to close at 26,141 pts. In the evening session, the index retested the psychological mark, touching the 26,033-pt session low before closing stronger at 26,154 pts. The session saw the index resuming its upward movement, with the bulls eyeing the immediate resistance of 26,190 pts. A breach of this threshold may see a follow through of buying interest. The index also printed a candlestick with a long lower shadow, indicating that – for medium term – the “higher highs and higher lows” bullish structure remains intact. Pending a bullish breakout, we keep our positive trading bias.

Traders should retain the long positions initiated at 24,809 pts, or the closing level of 7 Oct’s evening session. To mitigate trading risks, the trailing-stop threshold is placed at 25,250 pts.

The nearest support is established at 25,575 pts (1 Sep’s low), followed by 25,378 pts (19 Oct’s low). The immediate resistance is sighted at 26,190 pts – 13 Sep’s high – followed by 26,478 pts, or 8 Sep’s high.

Source: RHB Securities Research - 26 Oct 2021