Technical Update - Hang Seng, China A50 and Nikkei 225

Technical Update - Hang Seng, China A50 and Nikkei 225

Equities 3 minutes to read
KCL
Kim Cramer Larsson

Technical Analyst, Saxo Bank

Summary:  Strong bounce in Hang Seng/HK50 forming bottom and reversal pattern
China A50 trading wide range
Nikkei/JP225 in corrective phase that could turn into bearish trend


Hang Seng Index/HK50 bounced strongly Friday morning from August lows at 17,573 forming a Bullish Engulfing bottom and reversal candle in the process. The move engulfs the previous two trading days.

With RSI divergence a reversal is likely, however short-lived it might be. A reversal that could take Hang Seng to its resistance at around 18,900.

If closing above 18,900 short-term uptrend has been confirmed.

For Hang Seng to resume downtrend a close below 17,573 that would lead to a sell-off down to 17K

Source all charts and data: Saxo Group

China A50 future seems short-term directionless but is in fact trading in a larger range between 12,265 and 13,500. Very short-term the upper band is at around 13,064.
A bullish break is likely to push the A50 future to the 13,500 resistance

A close below 12,265 could fuel a sell-off down to around 11,150 with support at around 11,830

Nikkei 225 future/JP225 cfd seems to be in a corrective phase. Strong resistance at around 33,470.
However, Friday it took out the minor support at 32,170 closing below the Cloud and below the 55 Moving Average indicating a larger correction.
However, the 100 Moving Average is offering some support but if Nikkei225/JP225 is taking out Friday lows a move to strong support at around 31,240 could be seen

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