Hong Kong: HANG SENG INDEX (.HSI) markets end mostly lower as China’s tech stocks slump

Hong Kong: HANG SENG INDEX (.HSI) markets end mostly lower as China’s tech stocks slump

Hong Kong: HANG SENG INDEX (.HSI) markets end mostly lower as China’s tech stocks slump

  • Markets await U.S. trade tariff deadline this week
  • Yuan likely to consolidate at current level – trader
  • Stocks remain under pressure

China’s yuan rose sharply against the dollar on Wednesday, a day after the central bank assured markets it would keep the currency stable amid heightened worries about trade frictions, although stocks fell.

Chinese currency and equity markets have been volatile ahead of July 6, when U.S. tariffs on $34 billion worth of Chinese goods are set to kick in. Beijing has said it would retaliate with tariffs on U.S. products.

The yuan had its worst month on record in June, losing about 3.3 percent of its value against the greenback, and the slide continued on Monday, the first trading day of July.

An index tracking the 50 most representative blue-chips in Shanghai dubbed China’s “nifty 50”, slid around 1 percent to a near 14-month low.

In Hong Kong, the Hang Seng Index closed down 1 percent, while an index that tracks mainland companies had fallen about 1.5 percent.

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 29,967.13.

The projected upper bound is: 29,176.44.

The projected lower bound is: 27,208.23.

The projected closing price is: 28,192.33.

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 23 white candles and 27 black candles for a net of 4 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 48.6003. This is not an overbought or oversold reading. The last signal was a buy 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 31.45. 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 2 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 -95. 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 12 period(s) ago.

Rex Takasugi – TD Profile

HANG SENG INDEX closed down -303.900 at 28,241.670. Volume was 5% above average (neutral) and Bollinger Bands were 90% wider than normal.

Open High Low Close Volume___
28,546.32028,642.34028,141.27928,241.6702,167,194,368

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

Moving Averages: 10-period 50-period 200-period
Close: 28,876.96 30,312.00 29,976.63
Volatility: 21 21 21
Volume: 2,490,865,920 2,015,154,560 2,169,364,736

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 5.8% below its 200-period moving average and is in an downward trend. Volatility is relatively normal as compared to the average volatility over the last 10 periods. Our volume indicators reflect moderate flows of volume out of .HSI (mildly bearish). Our trend forecasting oscillators are currently bearish on .HSI and have had this outlook for the last 10 periods. The security price has set a new 14-period low while our momentum oscillator has not. This is a bullish divergence.

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