Hang Seng Index: Trendline Watch

Torn between the East & the West, and as the gateway to China, Hong Kong has had its own unique culture. This behaviour is often reflected in the Hang Seng Index. Leaning more and more towards Shanghai in the recent past, it has been trending sideways. Just like the SSEC, a short-term bounce may be in the offing.

Medium-term, the chart has the potential for a bullish Inverse Head & Shoulders, and looks decently setup for one more wave up. That scenario requires a break above the upper trendline in light blue within the next few months. In the very short-term, prices may exhibit more weakness towards 18800 level, and bounce up to test 19400.

Sustained weakness below lower crucial support of 17500, will change the picture to Bearish. Watch Shanghai & watch out for future updates.

All the best!