Hong Kong: HANG SENG INDEX (.HSI) city’s de facto central bank raised its base rate in line with the U.S. Federal Reserve

Hong Kong: HANG SENG INDEX (.HSI) city’s de facto central bank raised its base rate in line with the U.S. Federal Reserve

Hong Kong: HANG SENG INDEX (.HSI) city’s de facto central bank raised its base rate in line with the U.S. Federal Reserve

Hong Kong shares ended lower on Thursday after the city’s de facto central bank raised its base rate in line with the U.S. Federal Reserve, and warned of increasing downside risks to the economy.

At the close of trade, the Hang Seng index was down 241.86 points or 0.94 percent at 25,623.53. The Hang Seng China Enterprises index fell 1.03 percent to 10,090.75.

The sub-index of the Hang Seng tracking energy shares dipped 1.2 percent, while the IT sector dipped 0.88 percent, the financial sector ended 0.92 percent lower and the property sector dipped 1.2 percent.

The Hong Kong Monetary Authority (HKMA) on Thursday warned of increasing downside risks to the economy from uncertainty over the Sino-U.S trade dispute, urging residents to be prepared for possible market volatility after U.S. interest rate hikes. The HKMA increased the base rate charged through its overnight discount window by 25 basis points, but large banks left their prime lending rates unchanged.

Overall, the bias in prices is: Downwards.

By the way, prices are vulnerable to a correction towards 26,593.38.

The projected upper bound is: 26,774.87.

The projected lower bound is: 24,449.41.

The projected closing price is: 25,612.14.

Candlesticks

A black body occurred (because prices closed lower than they opened).
During the past 10 bars, there have been 4 white candles and 6 black candles for a net of 2 black candles. During the past 50 bars, there have been 24 white candles and 26 black candles for a net of 2 black candles.

Momentum Indicators

Momentum is a general term used to describe the speed at which prices move over a given time period. Generally, changes in momentum tend to lead to changes in prices. This expert shows the current values of four popular momentum indicators.

Stochastic Oscillator

One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 18.0895. This is an oversold reading. However, a signal is not generated until the Oscillator crosses above 20 The last signal was a buy 6 period(s) ago.

Relative Strength Index (RSI)

The RSI shows overbought (above 70) and oversold (below 30) areas. The current value of the RSI is 42.57. This is not a topping or bottoming area. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a buy 48 period(s) ago.

Commodity Channel Index (CCI)

The CCI shows overbought (above 100) and oversold (below -100) areas. The current value of the CCI is -102.This is an oversold reading. However, a signal isn’t generated until the indicator crosses above -100. The last signal was a buy 6 period(s) ago.

MACD

The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a sell 9 period(s) ago.

Rex Takasugi – TD Profile

HANG SENG INDEX closed down -241.861 at 25,623.529. Volume was 3% below average (neutral) and Bollinger Bands were 17% narrower than normal.

Open High Low Close Volume___
25,723.52925,859.82025,416.88125,623.5291,770,989,952

Technical Outlook
Short Term: Oversold
Intermediate Term: Bearish
Long Term: Bearish

Moving Averages: 10-period 50-period 200-period
Close: 25,978.48 25,896.30 28,400.77
Volatility: 19 29 23
Volume: 1,605,665,280 1,790,555,008 1,896,484,992

Short-term traders should pay closer attention to buy/sell arrows while intermediate/long-term traders should place greater emphasis on the Bullish or Bearish trend reflected in the lower ribbon.

Summary

HANG SENG INDEX is currently 9.8% below its 200-period moving average and is in an downward trend. Volatility is relatively normal as compared to the average volatility over the last 10 periods. Our volume indicators reflect volume flowing into and out of .HSI at a relatively equal pace (neutral). Our trend forecasting oscillators are currently bearish on .HSI and have had this outlook for the last 2 periods.

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