Maintain short positions. The HSIF struggled to break past the 20-day SMA line. It rose 30 pts to settle the day session at 23,296 pts, after oscillating between 23,436 pts and 23,139 pts. During the evening session, the index gave up its gains, falling 53 pts, and last traded at 23,243 pts. Based on the recent price action, the 20-day SMA line has proven to be a strong overhead resistance. We observed that the RSI is hovering below the 50% threshold, indicating that momentum remains weak. The index may consolidate sideways or retest the nearest support level of 23,070 pts. We will retain our negative trading bias until the trailing-stop is triggered.

Traders should hold on to the short positions initiated at 24,892 pts, or the closing level of 19 Nov 2021’s evening session. For trading risk management, the trailing stop is fixed at 23,745 pts.

The nearest support stays at 23,070 pts – 16 Dec 2021’s low – followed by 22,663 pts, or the low of 20 Dec 2021. Meanwhile, the immediate resistance remains at 23,745 pts – 15 Dec 2021’s high – and the higher resistance of 24,391 pts (13 Dec 2021’s high).

Source: RHB Securities Research - 5 Jan 2022