Hong Kong: Hang Seng Index (.HSI) trimmed gains as bleak China economic data overshadowed U.S. President Donald Trump’s trade concession

Hong Kong: Hang Seng Index (.HSI) trimmed gains as bleak China economic data overshadowed U.S. President Donald Trump’s trade concession

Hong Kong: Hang Seng Index (.HSI) trimmed gains as bleak China economic data overshadowed U.S. President Donald Trump’s trade concession

Hong Kong stocks trimmed early gains to end slightly firmer on Wednesday, as bleak China economic data overshadowed U.S. President Donald Trump’s trade concession, while protests continued to roil the island city.

The Hang Seng index ended up 0.1% at 25,302.28, while the China Enterprises Index gained 0.2% to 9,866.18.

The benchmark HSI started the day 1.7% higher, after Washington delayed tariffs on some Chinese imports.

U.S. President Donald Trump on Tuesday backed off his Sept. 1 deadline for 10% tariffs on remaining Chinese imports, delaying duties on cellphones, laptops and other consumer goods, in the hopes of blunting their impact on U.S. holiday sales.

China’s economy stumbled more sharply than expected in July, with industrial output growth cooling to a more than 17-year low, as the intensifying U.S. trade war took a heavier toll on businesses and consumers.

Activity in China has continued to cool despite a flurry of growth steps over the past year, raising questions over whether more rapid and forceful stimulus may be needed, even if it risks racking up more debt.

Worries also persisted over the protests that threatened to hit the island city’s economy.

Technical Indicators

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 27,083.64.

The projected upper bound is: 26,126.43.

The projected lower bound is: 24,414.46.

The projected closing price is: 25,270.45.

Candlesticks

A big black candle occurred. This is bearish, as prices closed significantly lower than they opened. If the candle appears when prices are “high,” it may be the first sign of a top. If it occurs when prices are confronting an overhead resistance area (e.g., a moving average, trendline, or price resistance level), the long black candle adds credibility to the resistance. Similarly, if the candle appears as prices break below a support area, the long black candle confirms the failure of the support area.
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.

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 17.5811. This is an oversold reading. However, a signal is not generated until the Oscillator crosses above 20 The last signal was a buy 4 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 18.97. This is where it usually bottoms. 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 buy 47 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 -90. 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 17 period(s) ago.

Rex Takasugi – TD Profile

HANG SENG INDEX closed up 20.979 at 25,302.279. Volume was 8% above average (neutral) and Bollinger Bands were 127% wider than normal.

Open     High      Low     Close     Volume___
25,711.10025,717.98025,197.38125,302.2791,915,522,816
Technical Outlook 
Short Term: Oversold
Intermediate Term: Bearish
Long Term: Bearish
Moving Averages: 10-period     50-period     200-period
Close: 26,107.72 27,741.26 27,598.87
Volatility: 21 20 21
Volume: 1,912,979,712 1,570,083,200 1,794,359,040

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 8.3% below its 200-period moving average and is in an downward trend. Volatility is high 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 12 periods. Our momentum oscillator is currently indicating that .HSI is currently in an oversold condition.

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