April 13 [HK Stocks Podcast] Part-1 - Hang Seng Index, Nio, and Kingboard Laminates

1. Hang Seng Index: Some investors are choosing bull certificates with a recovery price of 25,500 to bet on a rebound, expecting it to rebound to 25,900 points. Bearish investors are opting for bear certificates with a recovery price of 27,200 to hold overnight, believing that support will only come when the index falls back to 25,300-25,000.

The most critical aspect for the Hang Seng Index at this stage is not the daily fluctuations but whether the range between 25,500 and 25,700 points can transition from a short-term rebound into a more complete recovery trend. From the daily chart, the index is currently around 25,660 points, already above the 5-day moving average and reapproaching the 10-day and 20-day moving averages. However, resistance persists above, particularly near the 30-day moving average at approximately 25,528 points, the 20-day moving average at about 25,371 points, and the 60-day moving average at around 26,212 points. This indicates that the short-term sentiment has indeed improved compared to earlier, but overall, the market hasn't fully escaped the seesaw pattern.

Technically, after falling from its peak, the Hang Seng Index tested the 24,203-point level before gradually rebounding. It has now moved back above 25,000 points and is progressively reclaiming some short-term moving averages. Structurally, this rebound phase is no longer in the weakest rapid decline segment but has entered a recovery phase following a low-level bounce. However, recovery does not equate to renewed strength, as the most important resistance remains between 25,700 and 25,900 points, with another key level near 26,200 points. In other words, while there is a foundation for a rebound, if the index fails to break through and stabilize further, the current situation should still be regarded as a fluctuating recovery rather than a clear resumption of an upward trend.

In terms of short-term support, the initial focus is on the 25,500-point level. This position is close to the current level and also represents a clear dividing line for short-term market sentiment. If it holds firm, the index has the potential to continue testing higher levels between 25,700 and 25,900 points. The area around 25,900 points is not only a psychological threshold but also close to the recent high point of the rebound. If the index approaches this zone but fails to break through, profit-taking may occur. Looking higher, significant resistance lies near 26,200 points, which corresponds to the 60-day moving average. Failing to reclaim this area would mean the market hasn't truly regained strength in the medium term.

As for downside support, apart from the 25,500-point level, the next key zone is between 25,300 and 25,000 points. This range is crucial for sustaining the ongoing rebound. If the index merely consolidates normally and finds support within this region before bouncing back, the overall recovery assessment remains intact. However, if the 25,300-point support is breached, especially if it drops below 25,000 points, it suggests insufficient rebound momentum, and the market could revert to a weaker consolidation phase. In that case, the previous recovery structure might be disrupted, potentially leading to retesting even lower levels.

From the moving average distribution, the most noteworthy point currently is that the 5-day moving average has risen to around 25,663 points, the 10-day line is approximately 25,296 points, the 20-day line is about 25,371 points, and the 30-day line is near 25,529 points. This means the Hang Seng Index (HSI) has gradually returned to a dense area of short-to-medium term moving averages. However, such levels usually also represent heavy resistance, high volatility, and unclear direction. If the market can stabilize above 25,500 points in the coming days and then break through 25,700 to 25,900 points, the overall pattern will shift from a simple technical rebound towards a more complete recovery trend. Conversely, if it faces pressure again after nearing the resistance zone and retreats, it would indicate that the market is not yet ready for a direct upward push.

Regarding the RSI, the 14-day RSI in the chart is around 56, reflecting that momentum has improved compared to earlier but hasn't reached an extremely strong range. This kind of RSI structure typically indicates that the market has conditions for a rebound but isn't at a stage where it can completely ignore resistance. Therefore, the subsequent market movement is more likely to follow a rhythm of 'rebound, consolidation, and then choosing a direction,' rather than a one-sided upward surge.

Overall, the Hang Seng Index is currently in a repair pattern following a low-level rebound. The short-term trend isn't particularly weak, but neither is it strong enough to confirm a new round of upward momentum. The 25,500-point level acts as a short-term watershed; holding above it could allow further upward movement toward 25,700 to 25,900 points. A further breakthrough beyond this could lead to a challenge of 26,200 points. Conversely, if support in the 25,300 to 25,000-point range is lost, the rebound may come to an end, and the index might return to a volatile and weaker trend.

Therefore, a more reasonable view at this stage isn't a one-sided expectation of either a rise or decline, but rather whether the 25,500-point level can be held and whether the 25,900-point mark can be broken. If it holds, the rebound can continue; if it fails to break through and retreats, the overall situation will remain within a range-bound fluctuation, insufficient to confirm a trend reversal.

Investors in Nio (09866.HK) have noted simultaneous increases in both trading volume and price, raising expectations for future performance. Is there a chance for the stock to break through 60 yuan? Investors hold call warrants with an exercise price of 56.9 yuan.

What's most worth noting about Nio now isn't just the single-day surge but whether, after breaking through the 50 to 53 yuan range, the stock can stabilize further and extend its upward momentum. From the daily chart, the latest share price stands at 52.40 yuan, showing significant daily gains and closing near the day's high at 52.55 yuan, indicating a relatively strong trend. More importantly, the share price has clearly surged past and stabilized above several short-to-medium term moving averages, including the 5-day line at approximately 50.49 yuan, the 10-day line at 47.88 yuan, the 20-day line at 47.04 yuan, the 30-day line at 44.25 yuan, and even the 60-day line at 41.10 yuan and the 120-day line at 43.54 yuan, which were recovered some time ago. The overall technical structure has significantly improved compared to the previous period.

If we look purely at the pattern, this is no longer just a low-level rebound but is gradually forming into a rising wave pattern with each peak higher than the last, indicating a strengthening trend. The stock initially started around 34.82 yuan, then rose repeatedly in small increments, and recently broke out upward again, showing that the capital inflow isn't just aiming for short-term spikes but is instead being consistently absorbed. The reason this upward trend deserves attention is that it's not just the share price rising—trading volume is also increasing, representing a classic case of simultaneous increases in volume and price, which is more convincing than a dry rise alone. As long as a large bearish candle doesn't appear to engulf recent gains, the current trend should still be viewed as relatively strong.

Technically, the first key short-term level has shifted from the previous 50-yuan mark to the 51- to 52-yuan range. This area is gradually transitioning from a breakout point to short-term support. If the market pulls back but can hold within this range, it indicates that the upward structure remains intact, providing conditions to test higher levels later on. Regarding upside resistance, the immediate focus is on the 53.20-yuan level marked on the chart, representing a recent high. If the price can effectively break through and stabilize above this level, the next step will involve challenging higher integer thresholds.

As for whether the market can break through the much-discussed 60-yuan mark, the answer is: it has the potential to challenge this level, but it's not yet at a stage where it can be considered a short-term certainty. Rising from the current price of 52.40 yuan to 60 yuan still involves an increase of nearly 14% to 15%, and there will inevitably be resistance along the way. A more reasonable scenario is that the stock first stabilizes above the 51- to 52-yuan range, then breaks through 53.20 yuan, and subsequently moves closer to testing 54.90 yuan, which represents the 52-week high range. If the stock can successfully break through this range, market expectations for the 56- to 60-yuan range will significantly increase. In other words, while breaking 60 yuan isn’t impossible, the prerequisite is that the stock must consecutively overcome resistance zones above 53.2 yuan and 54.9 yuan; otherwise, the stock is still moving in this direction rather than having already confirmed it will reach that target directly.

From the perspective of the Bollinger Bands, the stock price has already moved above the upper band at 51.99 yuan, indicating strong short-term momentum. However, it also means the stock is now in a position where fluctuations are more likely to occur. Coupled with an RSI of around 69, which is nearing the overbought zone, this typically reflects a robust uptrend, but there could be short-term consolidation or even a pullback before resuming upward. Therefore, what investors should guard against most right now isn't a sudden complete reversal in the major trend, but rather profit-taking at elevated levels after a rapid rise. As long as such consolidation doesn’t breach key support levels, the overall trend will remain strong, not reversing.

For investors holding call warrants with an exercise price of 56.9 yuan, the focus lies in the fact that this product is already within a relatively close-to-the-money to slightly out-of-the-money range. If the underlying stock continues advancing toward 53.2 yuan and 54.9 yuan, the warrant theoretically could still benefit. However, if the stock fails to sustain its upward momentum and merely oscillates around the 52-yuan mark, the warrant’s performance may not fully align with investors' optimistic expectations due to time decay and changes in implied volatility affecting actual returns. Therefore, the ideal scenario for this position is not simply maintaining stability without falling but rather the underlying stock making continuous upward breakthroughs, especially quickly surpassing 53.2 yuan, which would be more advantageous for the call warrant.

Overall, Nio’s current trend is indeed strong, with both volume and price rising, a bullish alignment of moving averages, and the stock price stabilizing above 50 yuan. The outlook remains positive. In the short term, the focus will be on whether it can hold steady between 51 and 52 yuan. If it holds firm and breaks through 53.20 yuan, the next target could be testing 54.90 yuan, followed by aiming for the 56 to 60 yuan range. Hence, surpassing 60 yuan isn't impossible, but a more realistic observation sequence at this stage is to first confirm consecutive breakthroughs of 53.2 yuan and 54.9 yuan before assessing if there's enough momentum to challenge 60 yuan.

3. Kingboard Laminates (01888.HK): Investors are asking whether to wait for a breakout before entering. Some optimistic investors say they will continue to add positions and wait until it reaches HKD 30. In the warrants market, some investors hold long-term call warrants with an exercise price of HKD 25.88, stating that they have sold 75% and kept 25% to wait for a new high.

What is most noteworthy about Kingboard Laminates now is not just the sharp rise in a single day but whether the resistance zone between HKD 24 and HKD 25.68 has the potential to transition from a high-level consolidation to a breakout trend. From the daily chart perspective, the stock’s latest closing price is HKD 24.56, showing significant gains for the day with a high of HKD 24.98, closing near the daily high, reflecting strong buying momentum. More importantly, the stock price is clearly above the 5-day, 10-day, 20-day, 30-day, and 60-day moving averages, indicating a strong upward trend in the short to medium term.

Looking at the overall structure, Kingboard Laminates started its noticeable uptrend from around 14.05 yuan, hitting a high of 25.68 yuan, then entered a phase of high-level consolidation, recently fluctuating in the 19 yuan to 23 yuan range. Now, as the stock price pushes upward again and returns above 24 yuan, it indicates that the previous consolidation did not disrupt the overall uptrend but rather resembles another attempt to challenge the previous peak after high-level consolidation. This point is crucial because if it were a quick drop after a rapid rise, the market might worry about a false breakout; however, the current situation appears closer to recharging before continuing the uptrend.

Technically, the first level to watch in the short term is no longer around HKD 22 but rather between HKD 23.70 and HKD 24.00. This range has gradually shifted from being a resistance to a support level. As long as this support holds during pullbacks, the overall pattern before a breakout remains intact. Further support can be seen between HKD 22.80 and HKD 22.20, which also aligns with a dense area of short-term moving averages. If the stock pulls back to this region and finds support, it can still be considered a strong consolidation rather than weakening.

The most critical resistance above is undoubtedly the previous high at HKD 25.68. This level is the most important watershed at this stage. If the stock price only approaches this level and retreats under pressure, it indicates that the market is still oscillating within a high range and has not yet confirmed a breakout. However, if the stock can effectively break through HKD 25.68 and stabilize above it, the technical significance will change significantly because that would mean the stock has completed the breakout of its previous high, opening up greater upside potential.

As for whether investors should wait for a breakout before entering, technically speaking, it depends on one's investment style rather than being a matter of right or wrong. Based on the current chart structure, the stock has not yet officially broken through its previous high. Therefore, for a conservative approach, waiting for a clear breakout and stabilization above HKD 25.68 before following up is reasonable as it reduces the risk of false breakouts. The downside is that the entry point will be higher, but the advantage is that the direction is more confirmed. Conversely, for an aggressive deployment, taking positions incrementally above HKD 24 and below the previous high bets on the stock’s ability to directly challenge and break out. The advantage is a lower entry point, but the disadvantage is larger fluctuations if the previous high cannot be broken. In other words, waiting for a breakout is a more cautious approach, while deploying early at current levels is a bolder, forward-looking strategy.

As for whether targeting HKD 30 is overly optimistic, the answer is: at this stage, it should not be treated as a short-term target, but as a medium-term objective, it is not without foundation. With the current price at HKD 24.56, there is still over 20% upside to reach HKD 30, but the ascent will not be linear. First, the stock needs to break through HKD 25.68, then stabilize above HKD 26, before it can gradually move towards higher levels. If it cannot break the previous high, talking about HKD 30 would be premature. But if it successfully breaks out and trading volume continues to support it, the market will have grounds to raise its targets. Thus, HKD 30 can serve as an extended target but is not the most critical confirmation at this stage; what matters more now is whether it can achieve a breakout.

From the volatility channel perspective, the stock price is currently running above the upper band of approximately HKD 23.82, with the latest close further above the upper band, indicating very strong short-term momentum. However, it is also important to note that the Relative Strength Index (RSI) has risen to about 76, which is an overheated level. This suggests that although market sentiment is strong, there may be a temporary consolidation before deciding on the next direction. Therefore, the current strength should not be interpreted as being free from pullback risks but rather understood as strength accompanied by increased volatility. As long as any pullback does not violate key supports, the overall outlook should remain bullish.

For positions in call warrants with an exercise price of HKD 25.88, the underlying stock is now approaching this level, which is favorable in terms of direction. However, given that it is nearing an important resistance zone, the product's volatility will often be greater than that of the underlying stock. If the underlying stock fails to break through the previous high and instead fluctuates between HKD 24 and HKD 25.68, the call warrant may not fully reflect the apparent market strength. On the other hand, if the underlying stock successfully breaks out, these near-the-money products tend to show more noticeable performance. Therefore, the key focus for such positions now is not how much they have risen, but whether the previous high can truly be broken.

Overall, Kingboard Laminates’ current trend is clearly bullish, exhibiting a pattern of consolidating at highs before pushing forward. In the short term, watch if it can stabilize between $23.70 and $24.00; if stabilized and further rises above $25.68, it may officially begin a breakout trend. If it approaches the previous high and faces pressure again, it will remain in a range-bound consolidation for now. A conservative strategy would be to wait for a confirmed breakout before following, while an aggressive one would involve early bets on a breakout at current levels, accepting the associated volatility risks. As for $30, it can be seen as a subsequent upward target, but the precondition remains that the stock must first complete a breakout.

Reminder: This article does not constitute any investment advice.

This article is for reference only and does not constitute any investment advice. The market data, opinions, and analysis 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; a comprehensive assessment of asset performance should combine other data and should not solely rely on this article to make trading decisions. Please note that past performance is not indicative of future results. Follow Jenny's insights on Hong Kong stock warrants for more professional analysis.

$Hang Seng TECH Index (800700.HK)$ $Hang Seng China Enterprises Index (800100.HK)$ $TENCENT (00700.HK)$ $BABA-W (09988.HK)$ $JD-SW (09618.HK)$

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