Hong Kong: HANG SENG INDEX (.HSI) higher as a surprise rise in factory activity in mainland China and increased hopes of a U.S.-China trade agreement cheered investors

Hong Kong: HANG SENG INDEX (.HSI) higher as a surprise rise in factory activity in mainland China and increased hopes of a U.S.-China trade agreement cheered investors

Hong Kong: HANG SENG INDEX (.HSI) higher as a surprise rise in factory activity in mainland China and increased hopes of a U.S.-China trade agreement cheered investors

Hong Kong’s main stock index closed at its highest level in over six weeks on Friday as a surprise rise in factory activity in mainland China and increased hopes of a U.S.-China trade agreement cheered investors.

At close, the Hang Seng index climbed 0.7% at 27,100.76 points, its highest level since Sept. 16. The index gained 1.6% week-on-week. The Hang Seng China Enterprises index rose 0.9% on Friday.

The sub-index of the Hang Seng tracking energy shares rose 0.5%, the IT sector climbed 0.3%, the financial sector ended 0.9% higher and the property sector rose 0.8%.

The top gainer on the Hang Seng was Sunny Optical Technology Group Co Ltd with a 2.1% gain, while the biggest loser was CSPC Pharmaceutical Group Ltd, which fell 1.6%.

Factory activity in China expanded at its fastest pace in more than two years in October as export orders and production rose, a private business survey showed on Friday. The expansion beat expectations and contrasted with the dour results of an official survey on Thursday.

U.S. President Donald Trump said on Thursday the United States and China would soon announce a new site where he and Chinese President Xi Jinping will sign a “Phase One” trade deal after Chile canceled a planned summit set for mid-November.

China’s commerce ministry said in a statement on Thursday that bilateral talks will continue to proceed as previously planned and the lead trade negotiators from both countries will speak by telephone on Friday.

Around the region, MSCI’s Asia ex-Japan stock index was firmer by 0.4%, while Japan’s Nikkei index closed down 0.3%.

About 1.42 billion Hang Seng index shares were traded. The volume traded in the previous trading session was 1.91 billion.

At close, China’s A-shares were trading at a premium of 29.86% over Hong Kong-listed H-shares.

Technical Indicators

Overall, the bias in prices is: Upwards.

The projected upper bound is: 27,854.11.

The projected lower bound is: 26,380.64.

The projected closing price is: 27,117.38.

Candlesticks

A big white candle occurred. This is generally considered bullish, as prices closed significantly higher than they opened. If the candle appears when prices are “low,” it may be the first sign of a bottom. If it occurs when prices are rebounding off of a support area (e.g., a moving average, trendline, or retracement level), the long white candle adds credibility to the support. Similarly, if the candle appears during a breakout above a resistance area, the long white candle adds credibility to the breakout.
During the past 10 bars, there have been 5 white candles and 5 black candles. During the past 50 bars, there have been 21 white candles and 29 black candles for a net of 8 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 64.5191. This is not an overbought or oversold reading. 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 61.73. 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 52 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 160.This is an overbought reading. However, a signal isn’t generated until the indicator crosses below 100. The last signal was a sell 9 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 14 period(s) ago.

Rex Takasugi – TD Profile

HANG SENG INDEX closed up 194.039 at 27,100.760. Volume was 10% below average (neutral) and Bollinger Bands were 23% narrower than normal.

Open     High      Low     Close     Volume___
26,806.43927,102.42026,800.57027,100.7601,421,451,520
Technical Outlook 
Short Term: Neutral
Intermediate Term: Bullish
Long Term: Bearish
Moving Averages: 10-period     50-period     200-period
Close: 26,789.72 26,385.96 27,725.22
Volatility: 12 18 18
Volume: 1,433,541,888 1,624,769,408 1,777,040,256

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 2.3% below its 200-period moving average and is in an upward 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 bullish on .HSI and have had this outlook for the last 1 periods.

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