Hong Kong: HANG SENG INDEX (.HSI) give up gains, Shanghai extends rally

Hong Kong: HANG SENG INDEX (.HSI) give up gains, Shanghai extends rally

Hong Kong: HANG SENG INDEX (.HSI) give up gains, Shanghai extends rally

Hong Kong’s Hang Seng Index gave up gains made earlier in the day and ended up in the red while mainland markets continued their rally as global central banks pledged action to support economic growth.

The Hang Seng Index ended the day, down just over six points, at 26,284.

Across the border, the Shanghai Composite Index rose 0.7 percent, to 2,992 and the Shenzhen Composite Index gained just over 1 percent, to 1,888.

Tokyo, however, fell 1.2 percent, but Sydney rose 0.7 percent, while Seoul put on 0.6 percent.

Singapore and Mumbai edged up 0.3 percent, with Taipei and Manila gaining more than 1 percent, and Wellington, Bangkok and Jakarta more than 2 percent.

“One feels… that the newly found optimism sweeping the markets has a fragile foundation,” said Jeffrey Halley at Oanda. “We have not seen the end of ‘peak gyration’ in markets yet.”

On Tuesday, Australia cut borrowing costs to a record low and indicated it is ready to provide more help, making it the first major economy to take such measures.

Donald Trump jumped on the cut, using it to attack the Federal Reserve and renew his call for a similar move at home, saying: “Jerome Powell led Federal Reserve has called it wrong from day one. Sad!”

Malaysia also announced a cut on Tuesday.

Technical Indicators

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 27,211.78.

The projected upper bound is: 27,186.96.

The projected lower bound is: 25,320.32.

The projected closing price is: 26,253.64.

Candlesticks

A black body occurred (because prices closed lower than they opened).
During the past 10 bars, there have been 5 white candles and 5 black candles. During the past 50 bars, there have been 26 white candles and 24 black candles for a net of 2 white 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 25.4487. This is not an overbought or oversold reading. The last signal was a buy 3 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 35.60. 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 40 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 -90. This is not a topping or bottoming area. The last signal was a buy 0 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 6 period(s) ago.

Rex Takasugi – TD Profile

HANG SENG INDEX closed down -6.859 at 26,284.820. Volume was 31% above average (neutral) and Bollinger Bands were 4% wider than normal.

Open     High      Low     Close     Volume___
26,419.13126,527.75026,233.39126,284.8202,136,295,040
Technical Outlook 
Short Term: Neutral
Intermediate Term: Bearish
Long Term: Bearish
Moving Averages: 10-period     50-period     200-period
Close: 26,846.94 27,704.39 27,195.52
Volatility: 19 22 20
Volume: 2,047,470,464 1,716,907,008 1,656,571,776

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 3.3% below 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 24 periods.

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