HK50 Analysis – November-27-2023


Reuters — On Monday, the HK50 (Hang Seng) Index concluded the trading day with a modest downturn, shedding 34.36 points, or 0.2%, to close at 17,525.06. This marked the second consecutive session of decline, largely fueled by worries about China’s uncertain economic revival. Recent statistics revealed a slower growth in Chinese industrial profits, rising just 2.7% year-over-year in the last month, a significant decrease from the 11.9% surge seen in September. Looking at the broader picture, the first ten months of the year witnessed industrial profits dipping by 7.8%, the most lenient fall since December 2022.

Financial Dynamics and Market Responses

In the local context, there were indications of tightening liquidity towards the year’s end, highlighted by a spike in the one-month interbank offered rate to its highest point since 2007. Meanwhile, in the United States, futures traded slightly lower despite a record-breaking surge in online spending during Black Friday. Nevertheless, the Hang Seng Index managed to pare some of its earlier losses. This was partially driven by investors’ growing optimism that China’s property market downturn might be close to its end, thanks to various support measures from the Chinese government.

In terms of individual stocks, Longfor Group experienced a sharp drop of 4.2%. This was followed by declines in other notable companies like Sinopharm Group Co. (down 3.0%), Li Ning (down 2.9%), Yadea Group (down 2.2%), and Fosun International (down 1.5%).

HK50 Analysis: Technical Overview

FxNews – The HK50 index is currently exhibiting a bearish trend within its trading channel, as indicated by both the Relative Strength Index (RSI) and the Awesome Oscillator. Despite these bearish signals, the HK50 is managing to stay above a bullish trend line, which is marked in red. For the bearish trend to persist, it is crucial for the index to close below this trend line. Should this occur, the next bearish target is projected to be in the region of 16,823.

HK50 Analysis: Modest Decline in the Index

HK50 Analysis – November-27-2023

Conversely, as long as the index maintains its position above this critical line, there is potential for an upward correction. In such a scenario, the HK50 might approach the resistance level at $18,271. This dichotomy underscores the current volatility and the balance of bearish and bullish forces influencing the index’s movement.

  • 27 November 2023
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