After the Hang Seng Index rebounded and stabilized near the 25,700-point level, how can bull and bear warrants be deployed in stages for short-term trading?

After the rebound, the Hang Seng Index stabilizes near the 25,700-point level. How can bull and bear warrants be deployed in stages for short-term trading?

The Hang Seng Index closed at 25,752 points yesterday. The short-term trend has shown clear improvement compared to the previous period, and it has now regained its position above the 5-day, 10-day, 20-day, and 30-day moving averages. However, resistance remains ahead between 25,900 and 26,000 points, with another zone between 26,200 and 26,300 points. On the downside, initial support lies at 25,500 points, followed by a secondary range of 25,250 to 25,300 points. At this stage, the overall assessment can be seen as a tug-of-war at a key level following the rebound—it’s not yet fully strong, but neither has it weakened significantly. Therefore, there is room for deployment in both bull and bear warrants, with the focus being on distinguishing different scenarios.

Strategy One: Hold above 25,500 points, initially using bull warrants to bet on an extended rebound

If the Hang Seng Index can hold above 25,500 points and continue to stabilize around the 25,700-point level, this indicates that the short-term rebound structure remains intact. Such a strategy would suit using bull warrants with closer stop-loss levels and higher leverage to capture potential upward movement towards the 25,900–26,000-point range.

UBS 69276UBS Group 69276 could serve as an aggressive choice in this category, with a stop-loss level at 24,868 points and actual leverage of approximately 29.9 times. Such products have high leverage and are suitable for short-term bets on continued rebounds when the support level remains intact.

HSBC 55012HSBC 55012 represents a bull warrant closer to the support zone, with a stop-loss level at 25,128 points and actual leverage of about 39.0 times. Given that the stop-loss level is nearer to the current level, its responsiveness will be more direct, making it suitable for short-term rebound trades.

Strategy Two: Once breaking above the 25,900–26,000-point range, follow up with bull warrants

If the Hang Seng Index further breaks above the 25,900–26,000-point range, this indicates that the rebound may escalate, providing conditions to challenge the next target of 26,200–26,300 points. In such a scenario, consider deploying another set of bull warrants to ride the momentum, rather than prematurely entering before the breakout occurs.

UBS Group 54915 is a product worth noting in this group, with a call price at 24,900 points and actual leverage of approximately 30.3 times. This product balances flexibility with a reasonable call distance, making it suitable for short-term trend-following after a breakout.

BOC 54674 has a call price at 25,150 points and actual leverage of about 39.6 times, making it a more aggressive choice. If the index accelerates upward post-breakout, this type of product will respond more strongly to gains.

Strategy Three: If the index approaches but fails to break through 25,900 to 26,000 points, bearish warrants can be used to capitalize on pullbacks.

If the Hang Seng Index tests 25,900 to 26,000 points but fails to break through and faces pressure near the resistance level again, consider using bearish warrants for short-term pullback plays, targeting a move back to around 25,500 points. This type of setup falls under a resistance reversal strategy, with the key being that the index must fail to push higher to offer attractive odds.

UBS Group 56944 is a suitable choice in this group, with a call price at 26,288 points and actual leverage of approximately 37.9 times. The call price is set above the 26,000-point resistance zone, making it ideal for short-term reversal plays.

CMB 69208 has a call price at 26,300 points and actual leverage of about 36.8 times, also qualifying as a resistance reversal-type bearish warrant. If the Hang Seng Index cannot stabilize near the 26,000-point level, such products can be used to capture retracement moves.

Strategy Four: After breaking below 25,500 points, use bear warrants to follow the downward trend.

If the Hang Seng Index falls below 25,500 points, it indicates that short-term rebound momentum has weakened, and the market may retest levels between 25,250 and 25,300 points, or even lower. At this point, when deploying bear warrants, the focus should not be on testing resistance levels for reversal but rather on following the downward movement.

UBS Group 56966 Can serve as a directional choice in this group, with a call price of 26,538 points and actual leverage of approximately 27.1 times. Given the higher call price, it is relatively suitable for following the downtrend after breaking support, rather than aggressively targeting resistance levels for short plays.

BNP Paribas 66166 Call price at 26,600 points, with actual leverage of about 25.2 times, making it a more balanced product for downward deployment. If the index breaks below support and weakens further, such products can help capture a more complete retracement phase.

Key Deployment Points

At this stage, the Hang Seng Index is consolidating at a critical level after a rebound, with trading opportunities available on both sides. Therefore, bull and bear warrant strategies can be divided into four scenarios: defending the support level to bet on upside potential, chasing breakouts above resistance, reversing near resistance, and following declines after breaking support. The focus is not on one-sided market predictions but on switching tools according to positional changes.

Product Overview

$UB#HSI RC28096.C (69276.HK)$ | Call Price at 24,868 points | Actual Leverage of 29.9 times | High-Elasticity Bull Warrant | Suitable for defending 25,500 points and betting on continued rebound
$HS#HSI RC2812Q.C (55012.HK)$ ｜Recovery Price 25,128 points｜Actual Leverage 39.0x｜At-the-money Bull Certificate｜Suitable for short-term rebound deployment at the early stage
$UB#HSI RC2809G.C (54915.HK)$ ｜Recovery Price 24,900 points｜Actual Leverage 30.3x｜Trend-following Bull Certificate｜Suitable to follow up after breaking through 25,900 points
$BI#HSI RC2809F.C (54674.HK)$ ｜Recovery Price 25,150 points｜Actual Leverage 39.6x｜Aggressive Bull Certificate｜Suitable for betting on acceleration after a breakout
$UB#HSI RP2812C.P (56944.HK)$ ｜Recovery Price 26,288 points｜Actual Leverage 37.9x｜Resistance Reversal Bear Certificate｜Suitable for deployment when testing 26,000 points encounters resistance
$CI#HSI RP2810O.P (69208.HK)$ ｜Recovery Price 26,300 points｜Actual Leverage 36.8x｜Moderately High Elasticity Bear Certificate｜Suitable for betting on short-term pullbacks near resistance zones
$UB#HSI RP2812D.P (56966.HK)$ ｜Recovery Price 26,538 points｜Actual Leverage 27.1x｜Trend-following Bear Certificate｜Suitable to follow downside movement after falling below 25,500 points
$BP#HSI RP28035.P (66166.HK)$ ｜Recovery Price 26,600 points｜Actual Leverage 25.2x｜Balanced Bear Certificate｜Suitable for betting on a relatively complete pullback phase

For more market analysis, please continue following Jenny's daily updates on 'HK Stock Warrants'! Friendly reminder: This article does not constitute any investment advice. This article is for reference only and does not constitute any investment advice. Market data, opinions, and analyses contained herein may change at any time without prior notice. We are not responsible for any loss or damage caused by reliance on the information in this article. Technical analysis only shows whether certain technical conditions are met; asset performance should be assessed comprehensively with other data. Trading decisions should not be based solely on this article. Please note that past performance is not indicative of future results. #HKStocks #HSI #RealTimeAnalysis #WarrantSelection #WarrantStrategy #DerivativesHedging #JennysHKStockWarrants #BlueChipStocks #TechnicalAnalysis $Hang Seng Index (800000.HK)$$Hang Seng TECH Index (800700.HK)$

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