Hong Kong: HANG SENG INDEX (.HSI) stocks end lower for second day on Sino-US trade deal concerns

Hong Kong: HANG SENG INDEX (.HSI) stocks end lower for second day on Sino-US trade deal concerns

Hong Kong: HANG SENG INDEX (.HSI) stocks end lower for second day on Sino-US trade deal concerns

Hong Kong stocks closed lower for a second day on Thursday, as a fresh row between Washington and Beijing over a US bill backing protesters stoked concerns that trade talks could hit a snag and delay the “phase one” deal.

The Hang Seng index fell 1.6pc to 26,466.88, while the China Enterprises Index lost 1.6pc to 10,450.22.

The Hong Kong issue is definitely a negative factor in the trade talks, Zhang Yansheng, principal researcher at the state-affiliated think-tank China Center for International Economic Exchanges, said at the Bloomberg forum.

The US House of Representatives on Wednesday passed two bills to back protesters in Hong Kong and send a warning to China about human rights, with President Donald Trump expected to sign them into law, while in the middle of trade negotiations with Beijing.

Completion of a “phase one” US-China trade deal could be pushed into next year, trade experts and people close to the White House said, as Beijing presses for more extensive tariff rollback, and the Trump administration counters with heightened demands of its own.

China will strive to reach a “phase one” trade agreement with the United States as both sides keep communication channels open, the Chinese commerce ministry said on Thursday, in an attempt to allay fears talks might be unravelling.

Around the region, MSCI’s Asia ex-Japan stock index was weaker by 1.05pc, while Japan’s Nikkei index closed down 0.48pc.

The yuan was quoted at 7.037 per US dollar at 08:17 GMT, 0.01pc weaker than the previous close of 7.0364.

At close, China’s A-shares were trading at a premium of 28.07pc over Hong Kong-listed H-shares.

Technical Indicators

Overall, the bias in prices is: Downwards.

The projected upper bound is: 27,234.29.

The projected lower bound is: 25,690.80.

The projected closing price is: 26,462.54.

Candlesticks

A black body occurred (because prices closed lower than they opened).
During the past 10 bars, there have been 3 white candles and 7 black candles for a net of 4 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 5 falling windows in the last 50 candles–this makes the current falling window even more 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 67.7035. 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 44.53. 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 9 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 -89. This is not a topping or bottoming area. The last signal was a buy 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 sell 6 period(s) ago.

Rex Takasugi – TD Profile

HANG SENG INDEX closed down -422.729 at 26,466.881. Volume was 7% above average (neutral) and Bollinger Bands were 11% narrower than normal.

Open     High      Low     Close     Volume___
26,587.59026,587.59026,306.02026,466.8811,712,162,304
Technical Outlook 
Short Term: Neutral
Intermediate Term: Bearish
Long Term: Bearish
Moving Averages: 10-period     50-period     200-period
Close: 26,799.62 26,663.91 27,728.66
Volatility: 25 18 19
Volume: 1,516,637,440 1,535,613,824 1,760,289,280

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 4.6% below its 200-period moving average and is in an downward trend. Volatility is extremely high when compared to the average volatility over the last 10 periods. There is a good possibility that volatility will decrease and prices will stabilize in the near term. 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 0 periods.

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