Trump-Xi meeting news helps lift Hong Kong: HANG SENG INDEX (.HSI)
Judging from recent trading sessions, most investors seem sold into thinking that rate cuts by the US Federal Reserve are a certainty.
With news that US President Donald Trump and his Chinese counterpart Xi Jinping are set for an “extended meeting” at the G-20 Summit, and dovishness of other central banks added to the mix, risk-on attitudes returned to the fore.
Buoyed by the sentiment, the Straits Times Index (STI) closed at 3,288.17, rising 49.44 points or 1.5 per cent. It was more of the same elsewhere in the region as Australia, China, Hong Kong, Japan, Malaysia and South Korea all clocked gains.
Of the lot, Hong Kong’s Hang Seng Index fared the best, adding 2.6 per cent.
But markets can be myopic. The proposed Trump-Xi meeting merely removes the worry that the two leaders would not meet, but not concerns over whether a deal will be struck. Market observers note a warming of relations for the long haul may be too premature an assumption.
As one trader put it: “It was a good opportunity to take profit on Wednesday’s rally until the political climate is clear. It’s best to stay vigilant, especially since markets remain volatile and trade issues can always head south.”
In keeping with the risk-on mood, the Singapore market had another day of vibrant turnover.
Overall, the bias in prices is: Sideways.
The projected upper bound is: 29,026.90.
The projected lower bound is: 27,320.48.
The projected closing price is: 28,173.69.
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 24 white candles and 26 black candles for a net of 2 black candles.
A hammer occurred (a hammer has a long lower shadow and closes near the high). Hammers must appear after a significant decline or when prices are oversold to be valid. When this occurs, it usually indicates the formation of a support level and is thus considered a bullish pattern.
A hanging man occurred (a hanging man has a very long lower shadow and a small real body). This pattern can be bullish or bearish, depending on the trend. If it occurs during an uptrend (which appears to be the case with HANG SENG INDEX) it is called a hanging man line and signifies a reversal top. If it occurs during a downtrend it is called a bullish hammer.
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.
A spinning top occurred (a spinning top is a candle with a small real body). Spinning tops identify a session in which there is little price action (as defined by the difference between the open and the close). During a rally or near new highs, a spinning top can be a sign that prices are losing momentum and the bulls may be in trouble.
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.
One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 76.3920. This is not an overbought or oversold reading. The last signal was a sell 5 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 58.23. 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 8 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 211.This is an overbought reading. However, a signal isn’t generated until the indicator crosses below 100. The last signal was a sell 5 period(s) ago.
The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a buy 8 period(s) ago.
Rex Takasugi – TD Profile
HANG SENG INDEX closed up 703.371 at 28,202.141. Volume was 8% above average (neutral) and Bollinger Bands were 29% narrower than normal.
Open High Low Close Volume___
Short Term: Neutral
Intermediate Term: Bullish
Long Term: Bullish
Moving Averages: 10-period 50-period 200-period
Close: 27,387.83 28,537.64 27,435.58
Volatility: 23 19 22
Volume: 1,902,200,320 2,010,685,440 1,874,259,968
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.
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 2.8% above its 200-period moving average and is in an upward 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 bullish on .HSI and have had this outlook for the last 0 periods.