Technical Update - Hang Seng and Nikkei
Kim Cramer Larsson
Technical Analyst, Saxo Bank Group
Several times have Hang Seng tried to penetrate 0.618 retracement and resistance level at around 22,450 only to be rejected every time. Yesterday it happened again but there is still no reversal signal from the rebound.
However, RSI hasn’t closed above 60 threshold and there was no divergence at the troughs in March which indicates bear trend could resume.
If Hang Seng closes below short term rising trend line support at around 22,786 and the Gap from March is likely to be tested.
A close above strong resistance at 22,665 will demolish this scenario sending Hang Seng towards 0.764 retracement at around 23,442.
The HK50 cfd (Future) just touched the strong resistance at 22,653. It could be the exhaustive move of the rebound since mid-March. A break below 21,200 will confirm bearish trend to resume. Next key support is at the 0.618 Retracement at around 26K
Japan 225 cfd (Nikkei future) peeped above the 200 daily SMA a couple of times only to be sent back below. Now back below 100 SMA Bears seem to have taken control pushing the Index close to the 0.382 retracement at around 26,911.
MACD has turned bearish but RSI still bullish. However, with Tuesday and Wednesday’s bear move bearish trend seems to have resumed.
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