Hong Kong: HANG SENG INDEX (.HSI) fell on profit taking as investors awaited more clarity in trade negotiations

Hong Kong: HANG SENG INDEX (.HSI) fell on profit taking as investors awaited more clarity in trade negotiations

Hong Kong: HANG SENG INDEX (.HSI) fell on profit taking as investors awaited more clarity in trade negotiations

Asian stocks ended mixed on Tuesday after US President Donald Trump threatened to impose tariffs on selected EU goods in response to the claimed EU subsidies for Airbus.

Ongoing Brexit uncertainty and skepticism that any deal can permanently resolve US-China trade tensions also kept investors nervous, heading into the US earnings season.

Chinese shares fell on profit taking as investors awaited more clarity in trade negotiations with Washington.

The benchmark Shanghai Composite index finished down 0.16% at 3,239.66 while Hong Kong’s Hang Seng index inched up 0.27% to 30,157.49.

Overall, the bias in prices is: Upwards.

Note: this chart shows extraordinary price action to the upside.

The projected upper bound is: 30,932.57.

The projected lower bound is: 29,508.38.

The projected closing price is: 30,220.48.

Candlesticks

A white body occurred (because prices closed higher than they opened).
During the past 10 bars, there have been 6 white candles and 4 black candles for a net of 2 white candles. During the past 50 bars, there have been 31 white candles and 19 black candles for a net of 12 white candles.

An engulfing bullish line occurred (where a white candle’s real body completely contains the previous black candle’s real body). The engulfing bullish pattern is bullish during a downtrend. It then signifies that the momentum may be shifting from the bears to the bulls.

If the engulfing bullish pattern occurs during an uptrend (which appears to be the case with HANG SENG INDEX), it may be a last engulfing top which indicates a top. The test to see if this is the case is if the next candle closes below the top of the current (white) candle’s real body.

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 89.6677. This is an overbought reading. However, a signal is not generated until the Oscillator crosses below 80 The last signal was a buy 7 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 70.13. This is where it usually tops. 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 sell 29 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 115.This is an overbought reading. However, a signal isn’t generated until the indicator crosses below 100. The last signal was a sell 12 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 buy 4 period(s) ago.

Rex Takasugi – TD Profile

HANG SENG INDEX closed up 80.340 at 30,157.490. Volume was 16% above average (neutral) and Bollinger Bands were 13% wider than normal.

Open High Low Close Volume___
30,065.99030,222.02030,018.98030,157.4902,112,736,128

Technical Outlook
Short Term: Overbought
Intermediate Term: Bullish
Long Term: Bullish

Moving Averages: 10-period 50-period 200-period
Close: 29,446.58 28,685.98 27,426.84
Volatility: 11 16 22
Volume: 2,034,805,248 1,940,249,088 1,858,274,048

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 10.0% above its 200-period moving average and is in an upward trend. Volatility is low as compared to the average volatility over the last 10 periods. Our volume indicators reflect moderate flows of volume into .HSI (mildly bullish). Our trend forecasting oscillators are currently bullish on .HSI and have had this outlook for the last 4 periods. Our momentum oscillator is currently indicating that .HSI is currently in an overbought condition.

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