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Wuhan virus scare pushes Hong Kong: HANG SENG INDEX (.HSI) down 1.5 percent


Wuhan virus scare pushes Hong Kong: HANG SENG INDEX (.HSI) down 1.5 percent

Hong Kong equities closed sharply lower on Thursday as investors took flight over the deadly Sars-like virus that has spread from China.

The Hang Seng Index fell 1.5 percent, to end at 27,909.

Travel sector and airline shares were hit badly . Cathay Pacific dropped more than 2 percent. Retailer Sa Sa lost 4 percent over over lower demand from mainland tourists.

Macau casino shares were battered after Macau’s chief executive said he will not rule out closing all of the gambling hub’s casinos to contain a further spread of the Sars-like virus.

MGM China shed 5 percent. SJM lost 4 and a half percent. And Galaxy Entertainment slumped 3.5 percent.

Markets in Japan and South Korea each dropped just under one percent. Singapore was down 0.6 percent.

Tokyo’s benchmark Nikkei 225 index fell 1 percent as the safe-haven yen also firmed against the US dollar in a setback for Japanese exporters.

The pound strengthened sharply overnight after an industry report showed rising optimism among British manufacturers, upping the chances of a Bank of England rate cut later this month.

Technical Indicators

Overall, the bias in prices is: Sideways.

The projected upper bound is: 28,795.57.

The projected lower bound is: 27,061.97.

The projected closing price is: 27,928.77.


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 24 white candles and 26 black candles for a net of 2 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 15.6643. This is an oversold reading. However, a signal is not generated until the Oscillator crosses above 20 The last signal was a sell 6 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 46.12. 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 14 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 -124.This is an oversold reading. However, a signal isn’t generated until the indicator crosses above -100. The last signal was a buy 1 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 sell 2 period(s) ago.

Rex Takasugi – TD Profile

HANG SENG INDEX closed down -431.920 at 27,909.119. Volume was 15% above average (neutral) and Bollinger Bands were 25% narrower than normal.

Open     High      Low     Close     Volume___
Technical Outlook 
Short Term: Oversold
Intermediate Term: Bullish
Long Term: Bullish
Moving Averages: 10-period     50-period     200-period
Close: 28,622.27 27,516.31 27,518.93
Volatility: 23 20 19
Volume: 1,622,954,752 1,501,598,720 1,671,037,056

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 is currently 1.4% 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 25 periods.

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S. Jack Heffernan Ph.D. Economist at Knightsbridge holds a Ph.D. in Economics and brings with him over 25 years of trading experience in Asia and hands on experience in Venture Capital, he has been involved in several start ups that have seen market capitalization over $500m and 1 that reach a peak market cap of $15b. He has managed and overseen start ups in Crypto, Mining, Shipping, Technology and Financial Services.