HSI finds buyers again around 24586.06

Hong Kong Hang Seng Index (HSI) Technical Analysis Report for Oct 28, 2020 | by Techniquant Editorial Team


HSI breaks back below 100-day moving average
HSI closes lower for the 2nd day in a row
HSI finds buyers again around 24586.06
HSI still stuck within tight trading range
HSI closes within previous day's range after lackluster session


Moving lower for the 2nd day in a row, HSI finished Wednesday at 24708.80 losing $78.39 (-0.32%). Closing within the previous day's range, prices missed to decisively move beyond the prior day's trading range in a lackluster session.

Daily Candlestick Chart (HSI as at Oct 28, 2020):

Daily technical analysis candlestick chart for Hong Kong Hang Seng Index (HSI) as at Oct 28, 2020

Wednesday's trading range has been $258.73 (1.04%), that's below the last trading month's daily average range of $305.33. Weekly volatility is also lower, being below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for HSI. Prices continued to consolidate within a tight trading range between 24556.55 and 24970.59 where it has been caught now for the whole last trading week.

One bearish candlestick pattern matches today's price action, the Bearish Spinning Top.

Prices are trading close to the key technical support level at 24542.55 (S1). The stock index closed back below the 100-day moving average at 24751.80 for the first time since October 20th. When this moving average was crossed below the last time on October 15th, HSI actually gained 0.94% on the following trading day. After having been unable to move lower than 24602.11 in the previous session, the index found buyers again around the same price level today at 24586.06.

The market shows strength in the short-term supported by its long-term uptrend with only the medium-term trend being bearish.

Buying might accelerate should prices move above the close-by swing high at 24970.59 where further buy stops could get activated. Selling might speed up should prices move below the nearby swing low at 24556.55 where further sell stops could get triggered.

Among the seven market conditions that our pattern recognition engine identified today, the statistics for the Price Action based market condition "2 Consecutive Lower Closes" stand out. Though it is usually interpreted as bearish, it has actually shown to be bullish for Hang Seng. Out of 295 times, HSI closed higher 53.22% of the time on the next trading day after the market condition occurred. The optimal exit for swing trading this condition on the long side has been after 10 trading days, showing a win rate of 54.58% with an average market move of 0.19%.

With six out of the other six Major World Indices closing lower today, the ones that stand out on the negative side are DAX losing -4.17% and NDX closing -3.93% lower. None of the markets managed to end the day in the green. Read more

Market Conditions for HSI as at Oct 28, 2020

Loading Market Conditions for HSI (Hong Kong Hang Seng Index)...
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