Daytrade Review on the Hang Seng IndexI small trade today on the Hang Seng Index that turned out to be quick and simple with little to no pressure from the entry. Could have been a better exit but all up it was a good start to the day.
I will explain the price action for the Entry and the reasoning for the trade coming into the start of the session.
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HSI1! trade ideas
Maximum Pessimism - Blood on street - what do you do ?There are more negative and pessimistic news about China every day in the papers, online and social media. Remember, be it print or clicks , the more viewerships , the more money they can make (capturing your data and then selling advertisments or relevant news back to you)
So who wants to hear positive and good news huh? It is boring and unsensational!
China is now brutally being punished by Europe, US and Japan on the chips market, cutting them off from exporting the advanced materials that China needs. Of course, the business owners like Nvidia is unhappy as China remains one of its core customers.
Post Pandemic recovery? People have forgotten after the 3 years lockdown, it takes time to put things in order. Many small business operators have closed shops, bankruptcies are at all time high including the big boys (Walmart and Carrefour closing many outlets in China). Domestic demand is not back yet to its pre- Covid days.
Covid-19 has disrupted the world economy , more so for China as it stays locked down much longer than most countries. If it takes 21 days to make a new habit, think 3 years. It has structurally altered many consumers' habits ,being forced to stay at home. Their mindset has changed, their risk appetite is different being more conservative and cautious than before, worrying if a similar or worse pandemic might occur again.
A weakened yuan , a badly battered stock market which left a distaste in many analyst downgrading China economy and losing confidence. The property market still remains in a doldrum with many smaller developers hanging carrots to lure customers.
China is so fragmented that just looking at the Tier 1 cities performance is not conclusive as this are highly dense populated cities with great infrastructures , amenities and opportunities that continue to attract the lower tiers to come venture into.
The investment climate seems gloomy at the moment for China and other than Russia, it seems irrational to invest in China now. I do not hold a magic wane and able to predict the future of China but I believe in the story of China for the long haul.
I have long advocate the importance of diversification and that includes geographically, by sector, by asset class, by time horizon and investment objectives.
I hope in the next coming weeks or months, there will be some economic stimulus by the CCP to shore up the economy. It is important to note that not all sectors will grow strongly as CCP will continue to invest in places that are of strategic importance to its country, protecting its national security and achieving common prosperity for its people
Not a terrible place to place a bet.I see that we have held support, and were going back for a retest. I don't know how close we get, but if it touched into the baby blue box below, I think that's a great risk reward for a long position.
China is beaten down, fudded, this very well could be the bottom.
If it goes lower than the support, you probably want nothing to do with it till we see it above once again.
Hang Seng: Thumbed 👍Exemplarily, Hang Seng has thumbed our target zone and turned upwards from there. Thus, we classify wave 2 in turquoise as complete. Now, wave 3 in turquoise should carry Hang Seng above the resistance at 21 056 points. The counter movement of wave 4 in turquoise should then push the index back toward this mark before the ascent can be resumed once again. However, there is a 39% chance that Hang Seng could interrupt the current upwards movement, shifting southwards to develop the new low of wave alt.2 in turquoise, which should then be established before the support at 17 948 points.
HANGSENG Expected To Continuously Rise
1D - Retested the previous long-term downward trend line (red circle) and is rising again, and a falling wedge pattern is also underway.
Currently, the downward trend line (blue circle) that began on Jan. 30, 2023 has broken through, with only 19725 support likely to rise to 21047-21752/22400-2260.
1W
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I think there will be a warm wind in the Chinese market in the second half of this year.
HANG SENG: Inverted Head and Shoulders aiming for the 2021 High.Hang Seng is supported on the 1W MA50 with technicals both on the 1D and 1W time-frames (RSI = 51.130, MACD = 75.500, ADX = 25.377) neutral. This shows the high accumulation effect that is taking place as the huge Inverted Head and Shoulders pattern (whose Head formed the October bottom) is near to complete the Right Shoulder. Even though there are several Resistances on the way to the February 2021 High (R4 = 31,160), Inverted Head and Shoulders patterns technically target Fibonacci 2.0 from the neckline and that is at 30,900, just a fraction under the 2021 High. The action now is a buy (TP = 30,900).
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Hang Seng Index Volume and Price Action analysis - longThe Hang Seng Index shows a strong accumulation in the background along with a strong upward breakout. Before Friday's session and US labor market data to be released today, Hang Seng again showed strength and formed a re=accumulation range.
The last re-accumulation zone becomes both a big support and a buying zone for today's session.
Analysts expect good data from the US and big players seem to be setting the market for this data.
With the background we have on this chart, only longs should be considered
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Regards
VolumeDayTrader!
How to identify a TREND or RANGE market early in DaytradingTrading and Price Action can be broken down into tow simple terms...a 'range bound' market and a 'trend' market. Being able to identify the price action early is key to successful daytrading.
In the video I discuss how I like to daytrade Indexes and especially how I look to identify a RANGE or a TREND market. As there really is only TWO WAYs to trade....ie/ reversion to the mean or continuation trading...it is important to identify the market conditions early to get on the right side of the market and take full advantage of a move up or down.
I discuss my basic approach to trading and what I look for to identify the market conditions.
I talk about my trading style and general entry criteria.
Any comments or questions welcome below.
HANG SENG BUYIncreasing confidence for global economic resilience in 2023. Global growth for 2023 has continued to improve. The U.S. has started the year with a degree of momentum, even if activity could wane as the year progresses. Chinese activity is bouncing back as the economy reopens, while the Eurozone is likely to benefit as energy prices have receded and headline inflation has slowed. While banking and financial sector strains have clouded the outlook to some extent, we ultimately believe authorities will do whatever is needed and will be successful in containing those difficulties. Against that backdrop, our upwardly revised forecast means we now expect the global economy to avoid recession this year.
Hang Seng: Wait for It… ☝️Hang Seng is still busy in the magenta-colored zone between 20 867 and 18 707 points. On the one hand, the index has slowed the descent and could very well have completed wave (4) in magenta by now, readying itself to take off. After all, the requirements for the current movement’s conclusion have already been met by touching at the magenta-colored zone. On the other hand, Hang Seng still has got some room to expand wave (4) a bit deeper and could indeed make use of the whole magenta-colored zone. As soon as this low is established, though, the index should turn upwards and climb above the resistance at 22 798 points. However, there is a 36% chance that Hang Seng could develop wave alt.A and alt.B in turquoise first, the latter leading it out of the magenta-colored zone. In that case, wave alt.C should push the index back down into this area, where it should finish wave alt.(4) in magenta as well before moving northwards again.
Hang Seng: Just do it 💪The chinese Index isn't kidding around when it comes to fulfilling those New Year's resolutions and is using all its power to climb all the way North. We're expecting the Hang Seng to rise further into the turquoise target zone to complete the red wave (3). After completion, the course should fall back into a correction in order to finish the red wave (3). In case the Hang Seng can't carry on with its recent upwards pulses, we're expecting it to drop below the support line at 18 917 points. This would indicate the activation of our alternative scenario with a chance of 27%.
21-25/11/2022 weekly outlook
Bullish bias: Bids above 17770 would target 18213
Break and hold above 18437 targets a traverse towards 18824. Continuation above it would target 19330
Bearish bias: Offers below 17720 would target a test of 17544. Break and hold below it exposes 17277. Continuation below would target 16651