HSI poised to Retest the Breakout level and RallyHang Seng Index is pulling back to breakout level in the next few weeks, followed by rally.
Hangsengindex
A Han Seng Index Trade Early Monday morning Hello everyone,
The markets are slightly ruffled lately and there is an opportunity to short HS50 on Monday.
Trend:
W1: Up
D1: Down
H4: Down
Moving Average:
Below the Daily MA
H4 pointing downwards
Pattern:
Gartley on M15
Strong resistance at 16450.
Target is 16000
Double top on H1 and lots of divergence
Stop loss of 40 pips and a target of 120.
Hang Seng: Is a Turnaround Coming?The Hang Seng Index, with everything measured in Hong Kong Dollars rather than US Dollars, offers a distinct perspective within our analysis portfolio, focusing on the Hang Seng Index Futures contract. Starting with a weekly chart overview, we've identified that the initial cycle likely concluded in 2008, followed by a flat correction. Notably, the correction for Wave B exceeded 100%, suggesting that the drop towards Wave (A) level, or slightly lower, is plausible.
However, there's an alternative perspective that at Wave (A) already concluded Wave II, although the rapid temporal progression for such a wave suggests this is less likely. We anticipate further declines, yet it's critical to acknowledge a potential Wave (1) and Wave (2) formation at the 78.6% level. A drop below this point should lead us towards the HK$10,500 mark, aligning with our initial entry point around HK$11,300. Despite this, it's premature to issue a limit order given the ample time to observe developments.
Daily chart observations further indicate an expectation of a 5-wave structure from (B) to (C), which has been forming quite elegantly despite Wave ((iv)) intruding into Wave ((i)) territory. This necessitates our acceptance of the current count unless we opt for an interpretation that sees a completed Wave (2) at the point marked as Wave ((iii)).
Delving into the 4-hour details reveals a persistent downtrend from the onset of what's identified as Wave ((iv)). To reverse this trend, surpassing the invalidation zone would be crucial, suggesting a reconsideration for long positions. Until such a shift occurs, the bear flag's presence likely continues to restrain any significant upward movements in the market.
Tell your hedge fund to buy HSITell your hedge fund to buy Hang Seng Index and some Chinese stocks. Good returns will be coming in next years.
Hang Seng Analysis - Continuous, Just as the Markets !This is a Thread, so Follow for Technical Analysis performed with TrapZone Pro & UMVD Indicators.
* Trend is Based on TrapZone Color
* Bar Colors give us Momentum Green from strong Up Moves. Red Bars point to strong Down Moves.
* Red UMVD = Selling Pressure & Green UMVD = Buying Pressure. Purple is for Divergence = Battle of Supply & Demand
>> USE PAGE DN to go DOWN To the LATEST Post <<
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2-25-2024
Strong Upside Momentum with wide GREEN TrapZone established for a while and GREEN UMVD continues. Class A Entry at the top of the TrapZone.
Are we close to peak China pessimism?President Xi Jinping’s New Year address put paid to hopes of much larger stimulus.
In his address, President Xi pointed to the consolidation and enhancement of the
economic recovery and no signs of a boost from policy coming. Furthermore,
China’s economic growth for 2023 came out at 5.2%, above the central
government’s 5% forecast, which it boasted it was able to achieve without relying
on large stimulus.
China’s real GDP growth to slow further in 2024. Investors' pessimism towards China’s economy could be nearing a peak given recent efforts by policymakers to stabilize sentiment.
Policymakers acting to stabilize sentiment: China’s policymakers are
feeling the need to stabilize investor sentiment and this week have taken two
steps in this direction. First, following a recent State Council meeting, Premier
Li Qiang suggested help is on the way for China’s beleaguered stock market.
Newswire reports suggest this help could include CNY 2.3trn of funds (mainly
from SOEs) to buy Chinese equities to prop up the market. Such a measure
could help put a bottom on investors’ China pessimism. However, such purchases would not address their underlying concerns including a weak residential property market, local government debts, the lack of policy easing, and the risk of another regulatory clampdown.
Second, the PBoC surprised with an RRR cut as well as a cut to its re-lending
and discount rates. While I was expecting cuts to both, the
size and timing were surprising given the recent disappointment of the PBoC
keeping its MLF on hold. The PBoC also sounded dovish suggesting further
room to ease policy given the gap between actual and target prices and the
Fed’s pivot towards easing.
Check out my other ideas:
HSI: Already finished? 👀The HSI has risen sharply since Monday. Nevertheless, we continue to believe that the index is still working on a magenta-colored downward structure and is therefore not yet finished with its correction. Only after this five-part wave, and thus the turquoise-colored wave 3, has come to an end should things pick up a good bit - even if there is still further downside on a Long-term level. However, there is also a 33% probable alternative, which envisages a sustained rise and considers the past low to be the low of the green wave alt.(2). This scenario comes into effect if the resistance at 18 846 points is exceeded.
Ride the Japanese Wave, Don't Grab That China Falling KnifeIt was nearly three years ago when the China stock market notched a short-term peak. Recall how the world's second-largest economy was initially seen as a growth engine coming out of the worst of the pandemic. An authoritative regime in China, led by President Xi Jinping, crippled the economy's expansion trajectory through harsh ongoing lockdowns and by clamping down on many industries, one after another. Then in early 2023, hope sprang eternal that China would re-open amid a burst of consumer spending, a la what was seen during the 'revenge travel' period in the United States back in 2021 and 2022. That did not come to fruition, and the Hang Seng Index is now down by more than 50% in the last three years.
With all that turmoil going on in China, Japan's Nikkei 225 Index has continued to soar. Up more than 20% since February of 2021, the once sleepy Tokyo stock market features among the best momentum readings of all countries. Based on these trends, sticking with the 'long Nikkei, short China' trade should keep working, in my view. Another way to play it is by being long developed market stocks and avoiding emerging market funds (which still have a roughly 20% allocation to China).
Finally, while China trades at a single-digit P/E ratio today, Japan is by no means expensive. Goldman Sachs notes that the country's current 12-month forward earnings multiple is just 14.9, about average compared to its 20-year history (Asia-Pac ex-Japan is 12.3x, for perspective). Interestingly, Japan is back up to 6% of the global stock market allocation while China has sunk to just 3%. Perhaps it is indeed the land of the rising sun while China is a classic "sub"-merging market.
A solid ETF to play Japan continues to be the WisdomTree Japan Hedged Equity ETF (DXJ) which hedges exposure to the Japanese Yen. The ETF has a solid track record of outperforming other Japanese country funds.
Hang Seng Index God ViewThis version of God View includes Fractal Analysis
China QE = Roaring 20s or Black Swan Bust
BYD Short: Price target of $166.8 by EOYI expect BYD to fall to $166.8 given the following:
1. Price fall before trendline cut = price fall after trendline cut
2. Fibonacci extension level of wave 5 (of C) = 1.618 of wave 1 (of C).
HSI Short: Target ~15000This is a short update to HSI. I will expect that the burst up today is a corrective wave 4 and for the next 2 weeks, a correction down to 15000.
HSI Short: Target 15000 till EOY 2023My previous analysis of the Hang Seng Index was invalidated. And now I've done a revamp of the wave counts for 2023.
This is the summary:
1. Hang Seng will continue to fall either till Christmas or EOY.
2. Target support, or end of correction, will be 14980-15100. Look out for this support zone.
China A50: Last wave down. Prepare to long for the new year 2024To summarize:
1. We are currently in the 5th wave down. The last wave.
2. Potentially a sharp drop for the last 2 weeks of Dec 2023.
3. Price might follow the same pattern as Dec 2018.
4. Target 10130-10145.
Hang Seng Index: Pending Explosive Move UpIn this analysis, I talk about how I used Elliott Waves to count the moves of Hang Seng Index from Jan 2018 to 24th Nov 2023.
The main points to take note are these:
1. The corrective move down in 2023 is over.
2. We are still in a minor corrective move down.
3. But a wave 3 up is round the corner and that it will be an explosive one.
4. The risk is low for this bullish trade.
Hang Seng Index: Motivated! 💪The bulls were able to push the Hang Seng Index significantly higher on Friday, moving it further away from the yellow trading range between 17,424 and 15,571. However, we still expect the price to return to this area as part of the magenta wave (2) to make a lower low before the reversal occurs. That said, given the price action so far, we have to increase the probability of our alternative to 41%. In this case, the low of the magenta wave alt.(2) would already be in place and this scenario would come into play on a rise above the resistance at 18,898. However, it should be noted that our long-term expectation has already been fulfilled with the completion of the trading range. In both cases, there is considerable upside potential in the medium to long term. The price should clearly overcome the resistance at 20,899.
HONG KONG joins the bull marketThe HANG SENG INDEX is the main indicator of the overall market performance in Hong Kong.
The index has underperformed the rest of the world since March 2020 and was among the worst performing indices globally from 2020-2022.
In October 2022 however the Index seems to have moved up in a 5 wave structure after having seen quite a freefall from Feb. 2021. This 5 wave advance completed in Jan 2023, and since then, till the very recent low of Oct.2023 the Index corrected 61.8% of the entire Wave 1 rise.
Now however, the Index is ready give a massive 40-45% up move as the Wave 3 unfolds itself going forward into 2024-2025.
Note*- This post is for educational purpose only
Geely: Bears are back 🍯🐻The bears have now pushed Geely stock back below its March low. This confirms our primary scenario that the stock is in the final phase of the overarching gray wave II from the high of the magenta wave (B). This move should now be advanced to the green target zone between HK$7.80 and HK$4.12. With the low placed, the price should then move significantly higher.
Finally a chance to buy HK50The market is STILL BEARISH but,
1) HK50 is now fully oversold.
2) There is a harmonic pattern
3) There is H1 RSI divergence
Tight stop loss. We need to ensure to exit quickly as the market is still down.
Stock Index Review...Key Levels you need to watch!!We take a look at the Daily charts and price action on our Key Indexes.
It is important to have a longer term view of the price action and risk levels on the key markets so we will discuss our major markets and what we are looking for in the video.
We take a look at the following Key Indexes:-
Nasdaq, DOW, DAX, FTSE, ASX200, Hang Seng and the Nikkei.
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Hong Kong50 Hang Seng Short Bears Remain in Controlbearish start to the week, with hawkish central banks and growth fears continue weighing on investor sentiment ahead of a busy week.
The theme remained the same, with investor jitters over the economic outlook weighing on investor sentiment.
There were no economic indicators from the region to change the mood.
Market Overview
It was a bearish morning session for the Asian markets. The ASX 200 led the way down, with the Hang Seng and the Nikkei also struggling.
The Asian equity markets tracked the US equity markets into the red, with fears of central banks sending the global economy into a recession weighing. Hawkish Fed Chair Powell testimony continued to resonate this morning. Last week’s Bank of England 50-basis point interest rate hike was a reminder of central bank commitments to tame inflation.
Despite softer US private sector PMI numbers on Friday, the markets are still betting on a Fed 25-basis point interest rate hike in July. According to the CME FedWatch Tool, the probability of a 25-basis point July Fed rate hike stood at 71.9% versus 74.4% one week ago.
Significantly, the chances of the Fed lifting rates to 5.75% in September stood at 11.5%, up from 8.9% one week earlier.
Bank stocks also had a mixed morning. HSBC Holdings PLC and The Industrial and Commercial Bank of China (HK:1398) saw losses of 0.33% and 0.24%, respectively, while China Construction Bank (HK: 0939) rose by 0.40%.
Strategy Bearish Short
RSI confirming permanent trend continuation
Bulltraps can be used to sell more and stronger
Trendlines shold be used in 2 ways:
bearish breakout of the trendlines should be sed to new bearish enries or position sizing only.
Bullish breakouts should be used as profit taking or trading the 2nd wave only.
Bullish breakouts are often traps.
Bullish HSI Can Be Supportive For The KiwiNice bounce on HSI, looks like a bottom in 2022 because of an impulse up, now right shoulder at support. China is doing everything to support its economy, but with high rates in other major countries, they just cannot pick up that easily.
However, when economy in China will really start picking up that’s when commodity currencies like AUD and NZD can benefit. Also, recently China announced that they are in trade talks with New Zealand, so maybe NZD has also nice upside potential especially vs USD, now when FED can be close to end the hiking policy. Looking at NZDUSD chart, we can see slow price action and corrective wave structure after an impulse from the lows, which indicates for more gains in upcoming weeks/months.
Daytrade Review on the Hang Seng IndexI small trade today on the Hang Seng Index that turned out to be quick and simple with little to no pressure from the entry. Could have been a better exit but all up it was a good start to the day.
I will explain the price action for the Entry and the reasoning for the trade coming into the start of the session.
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Hang Seng: Thumbed 👍Exemplarily, Hang Seng has thumbed our target zone and turned upwards from there. Thus, we classify wave 2 in turquoise as complete. Now, wave 3 in turquoise should carry Hang Seng above the resistance at 21 056 points. The counter movement of wave 4 in turquoise should then push the index back toward this mark before the ascent can be resumed once again. However, there is a 39% chance that Hang Seng could interrupt the current upwards movement, shifting southwards to develop the new low of wave alt.2 in turquoise, which should then be established before the support at 17 948 points.
