CK Hutchison Holdings primary downtrend intact, further potential downside

CK Hutchison "gap resistance"filled, at risk of another downleg.

CK Hutchison Holdings (0001 HKG)

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Key Levels (1 to 3 weeks)

Pivot (key resistance): 73.00

Supports: 64.30 & 59.80

Next resistance: 79.10

Directional Bias (1 to 3 weeks)

Bearish bias below 73.00 key medium-term pivotal resistance for another round of potential impulsive downleg to retest 15 Aug 2019 low of 64.30 before targeting the next significant medium-term support at 59.80.

However, a clearance with a daily close above 73.00 invalidates the bearish scenario for a continuation of the corrective rebound towards the major resistance at 79.10 (former swing low areas of Oct 2011/Jun 2016 & upper boundary of the primary descending channel from Jan 2018 high).

Key elements

  • CK Hutchison Holdings, ranked number 11th in the Hang Seng Index based on market capitalised, also chaired by Hong Kong’s richest man, Li Ka-Shing has been evolving within a primary downtrend in place since 26 Jan 2018 high of 107.00.
  • The daily RSI oscillator remains bearish below a corresponding resistance at the 50 level after a test and retreat from it. These observations suggest that medium-term downside momentum remains intact.
  • The key medium-term resistance stands at 73.00 which is defined by the upper boundary of a medium-term descending channel from 09 Apr 2019 high and former swing low areas of 04 Jan/30 May 2019).
  • Today, 27 Aug price action is considered as negative as it has staged a push up to fill up the “gapped down” formed on Mon, 26 Aug and ended the session with a bearish daily candlestick.  
  • The significant medium-term support rests at 59.80 which is defined by the intersection point of the primary and medium-term descending channels and the former major swing low area of Oct 2008.
  • Relative strength analysis of CK Hutchison Holdings against the market (Hang Seng Index) is still not showing any clear signs of reversal from its underperformance.  

Charts are from eSignal 

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