Short-term technical outlook on Hong Kong 50 Index (Tues, 30 Jan)
Key technical elements
- The Index has started to show signs of a minor corrective decline after recent 19% rally from its 07 Dec 2017 low. Price action has broken below its minor ascending channel support from the minor swing low area of 15 Dec 2017 now turns pull-back support at 32800.
- The key short-term resistance stands at the 33100/170 zone which is defined by the former minor swing high area of 24 Jan 2018 and the 61.8% Fibonacci retracement of the on-going slide from yesterday high of 33530.
- Short-term downside momentum of price action remains intact as indicated by the hourly Stochastic oscillator has hooked down from its overbought region.
- The near-term supports rest at 32615 follow by 32150/32000 which is defined by the minor swing low area of 22 Jan 2018 and close to the 23.6% Fibonacci retracement of the up move from 07 Dec 2017 low to 29 Jan 2018 high.
Key Levels (1 to 3 days)
Intermediate resistance: 32800
Pivot (key resistance): 33100/170
Supports: 32615 & 32150/32000
Next resistance: 33530
Therefore as long as the 33100/170 key short-term resistance is not surpassed and a break below 32615 is likely to kick start a minor corrective mean reversion decline phase to target the near-term support of 32150/32000 in the first step.
On the other hand, a clearance above 33100/170 should put the mean reversion decline scenario on hold for a squeeze back up to retest the key 33530 medium-term pivotal resistance.
Chart is from City Index Advantage TraderPro
StoneX Financial Ltd (trading as “City Index”) is an execution-only service provider. This material, whether or not it states any opinions, is for general information purposes only and it does not take into account your personal circumstances or objectives. This material has been prepared using the thoughts and opinions of the author and these may change. However, City Index does not plan to provide further updates to any material once published and it is not under any obligation to keep this material up to date. This material is short term in nature and may only relate to facts and circumstances existing at a specific time or day. Nothing in this material is (or should be considered to be) financial, investment, legal, tax or other advice and no reliance should be placed on it.
No opinion given in this material constitutes a recommendation by City Index or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although City Index is not specifically prevented from dealing before providing this material, City Index does not seek to take advantage of the material prior to its dissemination. This material is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.