Hang Seng Index flashes reversal patterns at multi-year support zone
Hang Seng Index resisted; may retrace further
The HSI is printing a potential double top bearish reversal based on its 2013 high. At the moment it is supported by a major multi-year support resistance zone that goes back to 2009. Losing this support could send the index down to the next support zone between 21800 and 21300 (blue zone) in a mix of selling, profit taking.
Head and shoulders pattern on daily chart
The double top pattern is reinforced by another bearish chart pattern, a head and shoulders on the daily chart. The neckline level that has to break to confirm this observation coincides with the multi-year support painted in green. Price falling below decisively may be considered a signal, one that has many significance and confluence.
Fibonacci ratios rule the Hang Seng Index
So far Fibonacci ratios have dictated Hang Seng Index’s movement since we looked at it in June last year. These ratios are a recurring theme and have proven to make very reliable predictions for the index. If the ratios remain true, the next major 50.0% fib retracement agrees with 21300 for the cash index.
How to trade the Hang Seng Index Futures
Find Hang Seng Index Futures (HSI) on MT4. To pull out the chart, do the following:
- On the overhead toolbar, click ‘Market Watch’ to show panel on left.
- Anywhere in market watch panel, right click to show pop-up menu.
- Click ‘Show all’.
- Look for HSI.
Director, TerraSeeds Market Technician Pte Ltd. Trader, investor. @sohtionghum was picked ‘Top 70 Forex Twitter in 2015’.
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