HSI closes within prior day's range after lackluster session

Hong Kong Hang Seng Index (HSI) Technical Analysis Report for Feb 14, 2020 | by Techniquant Editorial Team


HSI unable to break through key resistance level
HSI finds buyers again around 27695.59
HSI stuck within tight trading range
HSI closes within previous day's range after lackluster session


HSI finished the week 1.5% higher at 27815.60 after gaining $85.60 (0.31%) today. Closing within the prior day's range, prices missed to decisively move beyond the previous day's trading range in a lackluster session.

Daily Candlestick Chart (HSI as at Feb 14, 2020):

Daily technical analysis candlestick chart for Hong Kong Hang Seng Index (HSI) as at Feb 14, 2020

Friday's trading range has been $265.07 (0.96%), that's below the last trading month's daily average range of $353.31. Weekly volatility is also lower, being below the market's average weekly trading range. The longer-term, monthly volatility is currently higher than usual for HSI. Prices continued to consolidate within a tight trading range between 27614.83 and 27960.66 where it has been caught now for the last three trading days.

In a volatile session, prices traded above the prior day's high as well as below the previous day's low, forming a bullish Outside Bar. The last time this happened on November 28, 2019, HSI actually lost -2.03% on the following trading day.

Unable to break through the key technical resistance level at 27857.73 (R1), the stock index closed below it after spiking up to 27960.66 earlier during the day. The failure to close above the resistance could increase that levels significance going forward. After having been unable to move lower than 27695.60 in the prior session, the index found buyers again around the same price level today at 27695.59.

The trend is clearly bullish, showing an intact uptrend in the short, medium and long-term.

Among the four market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "High close to previous High" stand out. Although it is usually interpreted as bearish, it has actually shown to be bullish for Hang Seng. Out of 476 times, HSI closed higher 54.20% 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 52.94% with an average market move of 0.16%.

With four out of the other six Major World Indices closing lower today, the ones that stand out on the negative side are NKY losing -0.59% and FTSE closing -0.58% lower. On the flipside the best performers have been NDX closing 0.29% higher and SPX gaining 0.18%. Read more

Market Conditions for HSI as at Feb 14, 2020

Loading Market Conditions for HSI (Hong Kong Hang Seng Index)...
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