Hong Kong: HANG SENG INDEX (.HSI) down as Tencent plunges
A sell off in Hong Kong and Chinese shares deepened following a slump in US equities amid persistent concerns about a trade war.
The Hang Seng Index sank 3.8%, falling below the 26,000 support level, with every member of the gauge declining. Tencent Holdings Ltd., the most valuable stock listed in Asia, slid 7.3% and was in line for its biggest loss since October 2011.
The benchmark Hong Kong equity gauge has tumbled 16% this year as fears of a trade war between the US and China spurred an exodus from what was the world’s best performing market as recently as January.
The Hang Seng Index was at 25,192 points at 11.34am. Selling pressure is likely to increase as Hong Kong’s easy money era ends and worsening tensions between Beijing and Washington make investors more jittery.
The HSI Volatility Index jumped 20%, the most since June 19.
Overall, the bias in prices is: Downwards.
Note: this chart shows extraordinary price action to the downside.
By the way, prices are vulnerable to a correction towards 27,630.13.
The projected upper bound is: 26,207.70.
The projected lower bound is: 24,192.37.
The projected closing price is: 25,200.04.
A black body occurred (because prices closed lower than they opened).
During the past 10 bars, there have been 2 white candles and 8 black candles for a net of 6 black candles. During the past 50 bars, there have been 20 white candles and 30 black candles for a net of 10 black candles.
A falling window occurred (where the bottom of the previous shadow is above the top of the current shadow). This usually implies a continuation of a bearish trend. There have been 4 falling windows in the last 50 candles–this makes the current falling window even more bearish. The two candles preceding the falling window were black, which makes this pattern even more bearish.
Three black candles occurred in the last three days. Although these candles were not big enough to create three black crows, the steady downward pattern is bearish.
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.
One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 9.9046. This is an oversold reading. However, a signal is not generated until the Oscillator crosses above 20 The last signal was a sell 9 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 26.98. This is where it usually bottoms. The RSI usually forms tops and bottoms before the underlying security. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a buy 18 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 -175.This is an oversold reading. However, a signal isn’t generated until the indicator crosses above -100. The last signal was a sell 9 period(s) ago.
The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a sell 5 period(s) ago.
Rex Takasugi – TD Profile
HANG SENG INDEX closed down -926.701 at 25,266.369. Volume was 67% above average (neutral) and Bollinger Bands were 32% wider than normal.
Open High Low Close Volume___
Short Term: Oversold
Intermediate Term: Bearish
Long Term: Bearish
Moving Averages: 10-period 50-period 200-period
Close: 26,675.32 27,435.56 29,676.31
Volatility: 23 24 23
Volume: 1,949,841,280 1,832,449,664 2,140,458,880
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.
HANG SENG INDEX gapped down today (bearish) on normal volume. Possibility of a Runaway Gap which usually signifies a continuation of the trend. Four types of price gaps exist – Common, Breakaway, Runaway, and Exhaustion. Gaps acts as support/resistance.
HANG SENG INDEX is currently 14.9% below its 200-period moving average and is in an downward trend. Volatility is extremely high when compared to the average volatility over the last 10 periods. There is a good possibility that volatility will decrease and prices will stabilize in the near term. 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 5 periods. Our momentum oscillator is currently indicating that .HSI is currently in an oversold condition.