Hong Kong: HANG SENG INDEX (.HSI) temporary pause on escalating the ongoing trade war

Hong Kong: HANG SENG INDEX (.HSI) temporary pause on escalating the ongoing trade war

Hong Kong: HANG SENG INDEX (.HSI) temporary pause on escalating the ongoing trade war

Stocks in Asia saw gains on Monday after Presidents Donald Trump and Xi Jinping agreed to a temporary trade truce between the United States and China.

The mainland Chinese markets, closely watched as a result of Beijing’s ongoing trade spat with Washington, saw strong gains on the day. The Shanghai composite gained 2.57 percent to close at around 2,654.80 while the Shenzhen composite advanced 3.275 percent to end the trading day at about 1,381.55.

The moves came following a new reading on economic activity in China, the Caixin Manufacturing Purchasing Managers’ Index, which showed factory activity grew slightly in November compared to the previous month.

Hong Kong’s Hang Seng index also jumped 2.5 percent as of the final hour of trade.

Japan’s Nikkei 225 rose 1 percent to close at 22,574.76 while the Topix index advanced 1.3 percent to end the trading day at 1,689.05. In South Korea, the Kospi gained 1.67 percent to close at 2,131.93.

Overall, the bias in prices is: Upwards.

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

The projected upper bound is: 28,340.68.

The projected lower bound is: 26,014.39.

The projected closing price is: 27,177.53.

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 22 white candles and 28 black candles for a net of 6 black candles.

A doji star occurred (where a doji gaps above or below the previous candle). This often signals a reversal with confirmation occurring on the next bar.

A long lower shadow occurred. This is typically a bullish signal (particularly when it occurs near a low price level, at a support level, or when the security is oversold).

A rising window occurred (where the top of the previous shadow is below the bottom of the current shadow). This usually implies a continuation of a bullish trend. There have been 4 rising windows in the last 50 candles–this makes the current rising window even more 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 68.9098. 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 63.94. 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 35 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 198.This is an overbought reading. However, a signal isn’t generated until the indicator crosses below 100. The last signal was a sell 17 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 22 period(s) ago.

Rex Takasugi – TD Profile

HANG SENG INDEX closed up 675.289 at 27,182.039. Volume was 46% above average (neutral) and Bollinger Bands were 28% narrower than normal.

Open High Low Close Volume___
27,185.66027,259.43027,006.83027,182.0392,628,559,872

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

Moving Averages: 10-period 50-period 200-period
Close: 26,328.94 26,140.56 28,698.83
Volatility: 24 28 24
Volume: 1,539,484,032 1,852,493,824 1,955,681,024

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 up today (bullish) 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 5.3% below 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 12 periods.

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