Hong Kong: HANG SENG INDEX (.HSI) market is hoping US-China trade talks will at least yield an extension of March 1 deadline

Hong Kong: HANG SENG INDEX (.HSI) market is hoping US-China trade talks will at least yield an extension of March 1 deadline

Hong Kong: HANG SENG INDEX (.HSI) market is hoping US-China trade talks will at least yield an extension of March 1 deadline

A 7.6 per cent year-on-year increase in domestic tourism during the Lunar New Year holiday failed to boost stocks on the first day of trading in the Year of the Pig in mainland China. The benchmark Shanghai Composite Index opened flat on Monday, while the Shenzhen Component Index opened higher, as the US-China trade talks continued to weigh on the market.

On Sunday, the official Xinhua news agency reported strong growth in domestic and international travel and spending over the week-long holiday, with border crossings in and out of China rising by 11 per cent from a year ago to 12.53 million. Domestic tourism generated 513.9 million yuan (US$76 million) in revenue, an increase of 8.2 per cent.

The Shanghai Composite Index opened flat, down 0.042 per cent, or 1 point, at 2617.12, while the Shenzhen Component Index was trading higher by 0.95 per cent, or 72.93 points, at 7,756.93. The CSI 300 index was up 0.082 per cent, or 2.65 points, at 3,250.

In Hong Kong, the Hang Seng Index was almost flat, opening down by 0.18 per cent, or 49 points, at 27,897.09. Utility stocks bucked the trend, as CLP Holdings was up 0.3 per cent at HK$92.2, while HK & China Gas was up 0.57 per cent at HK$17.44.

Overall, the bias in prices is: Upwards.

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

By the way, prices are vulnerable to a correction towards 27,046.10.

The projected upper bound is: 29,010.91.

The projected lower bound is: 27,217.84.

The projected closing price is: 28,114.38.

Candlesticks

A white body occurred (because prices closed higher than they opened).
During the past 10 bars, there have been 8 white candles and 2 black candles for a net of 6 white candles. During the past 50 bars, there have been 30 white candles and 20 black candles for a net of 10 white candles.

Three white candles occurred in the last three days. Although these candles were not big enough to create three white soldiers, the steady upward pattern is bullish.

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 75.6442. This is not an overbought or oversold reading. The last signal was a sell 2 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 71.34. 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 1 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 101.This is an overbought reading. However, a signal isn’t generated until the indicator crosses below 100. The last signal was a sell 1 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 21 period(s) ago.

Rex Takasugi – TD Profile

HANG SENG INDEX closed up 125.180 at 28,071.500. Volume was 50% below average (consolidating)(neutral) and Bollinger Bands were 4% narrower than normal.

Open High Low Close Volume___
27,927.44928,072.48027,847.85028,071.500 877,446,656

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

Moving Averages: 10-period 50-period 200-period
Close: 27,732.29 26,547.57 27,782.32
Volatility: 10 22 23
Volume: 1,651,487,616 1,672,147,584 1,828,112,640

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 1.0% above its 200-period moving average and is in an upward trend. Volatility is extremely low when compared to the average volatility over the last 10 periods. There is a good possibility that there will be an increase in volatility along with sharp price fluctuations in the near future. 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 17 periods. Our momentum oscillator is currently indicating that .HSI is currently in an overbought condition.

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