HSBC: Technical rebound in a bearish trend

HSBC, the global banking group, announced that 3Q adjusted profit before tax declined 20.6% on year to 4.30 billion dollars on adjusted revenue of 12.07 billion dollars, down 9.6%.

Uptrend 2

HSBC, the global banking group, announced that 3Q adjusted profit before tax declined 20.6% on year to 4.30 billion dollars on adjusted revenue of 12.07 billion dollars, down 9.6%. 3Q profits beat market expectations. Adjusted expected credit losses reduced to 785 million dollars from 3.95 billion dollars in the prior quarter and 843 million dollars in the prior-year period. The bank said it will consider paying a "conservative dividend" for 2020, which "would be dependent on the economic outlook in early 2021, and be subject to regulatory consultation".

From a chartist point of view, the stock price has landed on a massive support zone near 2009 low and is posting a rebound. The daily Relative Strength Index (RSI, 14) validated a bullish divergence calling for a technical rebound within the bearish trend. In addition, prices escaped from a downward-sloping channel. Readers may want to consider the potential for opening Long positions above the support at 306p with 370p and 392p as targets. A break below 306p would negate the bullish view and would call for the resumption of the medium term down trend. 

Source: GAIN Capital, TradingView


More from Equities

Join our live webinars for the latest analysis and trading ideas. Register now

GAIN Capital UK Limited (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.

For further details see our full non-independent research disclaimer and quarterly summary.