Maintain short positions. The HSIF continued to move lower yesterday, falling 361 pts to settle at 22,781 pts – printing a new 52-week low. It opened at 23,140 pts and immediately hit the intraday high of 23,257 pts before shifting south towards the day’s low of 22,663 pts. It then rebounded moderately towards the close. In the evening session, it oscillated to touch the session’s high of 22,899 pts before retracing. It last traded at 22,780 pts. Yesterday’s long black candlestick signals that there is strong selling momentum below the immediate supportturned-resistance level of 23,070 pts. As previously mentioned, the bearish pattern will remain valid below the 20-day SMA line. We keep to our negative trading bias until the index reverses and triggers the trailing-stop.

Traders are advised to keep the short positions initiated at 24,892 pts, or the closing level of 19 Nov’s evening session. To mitigate trading risks, the trailing-stop is revised lower to 23,745 pts.

The immediate support is lowered to 22,663 pts – 20 Dec’s low – followed by 22,450 pts. Meanwhile, the nearest resistance is pegged at 23,070 pts – 16 Dec’s low – followed by 23,745 pts, which was 15 Dec’s high.

Source: RHB Securities Research - 21 Dec 2021