Hang Seng Index Chart AnalysisPublished on 20 March 2020
- Looking at the HSI daily chart, the market closed with a bearish shooting star candle the day after a bullish hammer candle formed, closing near the low, below the 78.6% Fibonacci retracement level.
- With the uncertainties and volatility that arise due to the COVID-19 situation, caution should be used when placing stop losses that are not sufficiently large because it is highly possible that markets will gap up/down over the weekend.
- We can expect price to continue the bearish momentum and look towards the first support level of around 21000 (higher green arrow).
- If markets were to gap below this level, the next support level should be used at the round figure of 20000 (lower green arrow).
- If however, price does not gap lower, we can expect the 61.8% Fibonacci retracement level to act as a resistance level before further consolidation.
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