HSI pops to highest close since December 5, 2018
Hong Kong Hang Seng Index (HSI) Technical Analysis Report for Jan 11, 2019 | by Techniquant Editorial Team
Moving higher for the 6th day in a row, HSI ended the week 4.06% higher at 26667.27 after gaining $145.84 (0.55%) today. Today's close at 26667.27 marks the highest recorded closing price since December 5, 2018. Ending the day with an indecisive close, neither buyers nor sellers were able to gain control during the session.
Daily Candlestick Chart (HSI as at Jan 11, 2019):
Friday's trading range has been $197.16 (0.74%), that's below the last trading month's daily average range of $342.36. Things look different on the weekly timeframe, where the market's trading range of the last week has been slightly above the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for HSI.
Two candlestick patterns are matching today's price action, the Bearish Hikkake Pattern and the Hanging Man which are both known as bearish patterns.
After trading down to 26494.86 earlier during the day, the index bounced off the key technical support level at 26581.93 (S1). The failure to close below the support might increase that levels significance as support going forward. When prices bounced off a significant support level the last time on Tuesday, HSI gained 2.27% on the following trading day.
Though still in a long-term downtrend, the short and medium-term trends both turned bullish already.
Further buying could move prices higher should the market test December's close-by high at 27260.44.
Among the six market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "Bounced off Technical Support S1" stand out. Its common bullish interpretation has been confirmed for Hang Seng. Out of 345 times, HSI closed higher 60.58% of the time on the next trading day after the market condition occurred. The optimal exit for swing trading this condition on the long side has been after 10 trading days, showing a win rate of 52.46% with an average market move of 0.35%.
With five out of the other six Major World Indices closing lower today, the ones that stand out on the negative side are FTSE losing -0.36% and DAX closing -0.31% lower. On the flipside the best performer has been NKY closing 0.97% higher. Read more