《Trading Strategies》Currently, the actual holding levels of the short-term, medium-term, and long-term securities investment portfolios in this column are 62.5%, 50%, and 35% respectively, with market conditions categorized as bearish, significantly bearish, and significantly bearish respectively. Recently, the Hang Seng Index has fluctuated within a sideways range during its corrective phase. The upward wave that began from the previous downtrend low of 22,518 on June 26 ended at the high of 26,188 on August 4. The 0.618 Fibonacci retracement level of that rise measures a potential decline to 23,920. According to Elliott Wave Theory, 0.618 is a highly significant golden ratio, often used to calculate important support levels after a corrective wave begins; the reverse also applies. In other words, once the index falls near this level, it often reverses upward; however, if it fails to stabilize above this level (brief and minor breaches downward may be tolerated), the likelihood of continuing to fall back to the starting point of the previous uptrend increases significantly, often accompanied by very rapid declines. Currently, bulls and bears are once again locked in a tug-of-war near this level, with the outcome uncertain.
If you carefully observe the daily chart, counting by closing levels, the support at 23,920 has now been breached twice—first on August 8 and second yesterday (August 20). The first breach could be considered a false breakdown, but after the second breakdown, bulls should not be complacent, unless the index quickly reverses and surges upward again today (August 21). If the index falls significantly below this level or closes below it for three consecutive trading days, bulls should retreat to lower positions temporarily to ensure safety. Regarding major technical indicators, MACD must avoid issuing a "double bearish" sell signal, which would shift the short-term outlook from bearish to significantly bearish, attracting more selling pressure. Additionally, the continuously descending lower band of the Bollinger Bands will exert downward pull on the index, making it easier to fall than to rise, until major technical indicators gradually improve and bearish players begin to withdraw.
Chief Investment Advisor, Economic Information and Trading Services, Benny Leung (Website: www.BennyLeung.com)
*Articles published in Economic Information, signed or unsigned, represent the authors' personal opinions and do not necessarily reflect the views of Economic Information. Economic Information serves as a platform providing free expression of opinions.
If you carefully observe the daily chart, counting by closing levels, the support at 23,920 has now been breached twice—first on August 8 and second yesterday (August 20). The first breach could be considered a false breakdown, but after the second breakdown, bulls should not be complacent, unless the index quickly reverses and surges upward again today (August 21). If the index falls significantly below this level or closes below it for three consecutive trading days, bulls should retreat to lower positions temporarily to ensure safety. Regarding major technical indicators, MACD must avoid issuing a "double bearish" sell signal, which would shift the short-term outlook from bearish to significantly bearish, attracting more selling pressure. Additionally, the continuously descending lower band of the Bollinger Bands will exert downward pull on the index, making it easier to fall than to rise, until major technical indicators gradually improve and bearish players begin to withdraw.
Chief Investment Advisor, Economic Information and Trading Services, Benny Leung (Website: www.BennyLeung.com)
*Articles published in Economic Information, signed or unsigned, represent the authors' personal opinions and do not necessarily reflect the views of Economic Information. Economic Information serves as a platform providing free expression of opinions.
