Hong Kong: HANG SENG INDEX (.HSI) lower after the U.S. jobs report showed the economy stateside adding 224,000 jobs in June

Hong Kong: HANG SENG INDEX (.HSI) lower after the U.S. jobs report showed the economy stateside adding 224,000 jobs in June

Hong Kong: HANG SENG INDEX (.HSI) lower after the U.S. jobs report showed the economy stateside adding 224,000 jobs in June

Stocks in Asia were lower on Monday after a strong jobs report last Friday stateside moderated expectations that the U.S. Federal Reserve could soon be making a move on interest rates.

In mainland China, the Shanghai composite fell 2.58% on the day to 2,933.36, while the Shenzhen component declined 2.72% to finish its trading day at 9,186.29. The Shenzhen composite also shed 2.898% to close at 1,554.80.

Hong Kong’s Hang Seng index dropped 1.66%, as of 3:15 p.m. HK/SIN, following another round of protests that rocked the city on Sunday. At the same time, the MSCI Asia ex-Japan index also fell 1.42%.

The moves came as Tokyo and Seoul remain locked in a dispute over forced wartime labor, with Japan imposing tighter restrictions last week on the export of high-tech materials used in smartphone displays and chips to South Korea.

“Our basecase for the trajectory of this trade issue and Japan-South Korea relations as a whole is broadly negative,” Scott Seaman, director of Asia at Eurasia Group, wrote in a note. “In a nutshell, we believe the two governments will engage in a tit-for-tat exchange of retaliatory measures for at least the next several months that further sours bilateral relations.”

Meanwhile, the S&P/ASX 200 in Australia declined 1.17% to close at 6,672.2. Shares of major miners slipped on news of a probe by Chinese steelmakers on the surge in iron ore prices. Rio Tinto shed 0.98% and BHP Billiton fell 1.77%.

Overall, the bias in prices is: Sideways.

The projected upper bound is: 29,185.31.

The projected lower bound is: 27,412.81.

The projected closing price is: 28,299.06.

Candlesticks

A black body occurred (because prices closed lower than they opened).
During the past 10 bars, there have been 4 white candles and 6 black candles for a net of 2 black candles. During the past 50 bars, there have been 23 white candles and 27 black candles for a net of 4 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 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 47.2305. This is not an overbought or oversold reading. The last signal was a sell 1 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 52.16. 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 20 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 -21. This is not a topping or bottoming area. The last signal was a sell 3 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 20 period(s) ago.

Rex Takasugi – TD Profile

HANG SENG INDEX closed down -443.141 at 28,331.689. Volume was 34% below average (neutral) and Bollinger Bands were 20% wider than normal.

Open High Low Close Volume___
28,513.14128,541.10028,194.07028,331.6891,289,561,088

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

Moving Averages: 10-period     50-period     200-period
Close: 28,571.80 28,192.12 27,482.13
Volatility: 16 20 22
Volume: 1,465,647,616 1,897,789,824 1,861,079,808

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 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 3.1% above its 200-period moving average and is in an upward trend. Volatility is high 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 12 periods.

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