Hong Kong: HANG SENG INDEX (.HSI) drops sharply over corporate profit warnings
Hong Kong stocks closed sharply lower on Tuesday as the deadly new coronavirus took a toll on corporate earnings and economic growth.
The Hang Seng Index fell 1.5 percent, to close at 27,530.
On the mainland, the Shanghai Composite Index was up 0.1 percent, at 2,984. while the Shenzhen Composite Index rose 1.1 percent, to 1,856.
Tokyo’s benchmark Nikkei 225 index closed down 1.4 percent – its fourth straight session in the red – a day after data showed the economy shrank in the December quarter, even before the effects of the virus hit Japan.
Elsewhere, Singapore fell 0.4 percent as investors digested the government’s decision to cut its economic growth forecast for this year as the virus batters the city state’s tourism and trade.
Seoul was off 1.5 percent and Taipei lost 1 percent. Sydney shed 0.2 percent.
Investor jitters spread as Apple warned the new coronavirus had hit output and demand in China, fuelling fears over the wider impact of the epidemic on corporate earnings and economic growth. HSBC reporting a 33 percent drop in its profits added to the gloom.
“Best to buckle in as we could be in for a bumpy ride [over] the next few weeks,” said Stephen Innes of AxiCorp.
“I’m struggling to find any research report that doesn’t suggest (Covid-19) could significantly affect short term earnings.”
Overall, the bias in prices is: Sideways.
The projected upper bound is: 28,503.92.
The projected lower bound is: 26,602.04.
The projected closing price is: 27,552.98.
A black body occurred (because prices closed lower than they opened).
During the past 10 bars, there have been 7 white candles and 3 black candles for a net of 4 white candles. During the past 50 bars, there have been 27 white candles and 23 black candles for a net of 4 white candles.
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 63.3939. This is not an overbought or oversold reading. The last signal was a sell 0 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 48.62. 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 sell 30 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 51. This is not a topping or bottoming area. The last signal was a sell 0 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 buy 5 period(s) ago.
Rex Takasugi – TD Profile
HANG SENG INDEX closed down -429.400 at 27,530.199. Volume was 1% above average (neutral) and Bollinger Bands were 28% wider than normal.
Open High Low Close Volume___
Short Term: Overbought
Intermediate Term: Bearish
Long Term: Bullish
Moving Averages: 10-period 50-period 200-period
Close: 27,536.90 27,702.77 27,305.94
Volatility: 21 22 20
Volume: 1,755,775,104 1,608,489,344 1,664,707,072
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 is currently 0.8% above its 200-period moving average and is in an downward trend. Volatility is high 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 14 periods.
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