The gap remains unfilled, the broader market is volatile; Hong Kong Exchange faces short-term test at HKD 408

After recently rising to around HKD 416, the Hong Kong Exchange has entered a consolidation phase, with market commentary reflecting the typical tug-of-war mentality at highs. On one hand, some investors still believe that the Hong Kong Exchange is resilient and even see the current level as an opportunity to wait for further gains or to accumulate positions. On the other hand, there are also many voices expressing concerns about the unfilled gap and the difficulty of resisting a pullback in the broader market, with some even suggesting that prices are merely being propped up. This indicates that investor sentiment is not uniformly optimistic but rather cautious and观望.

Based on key points from the commentary, the market's main concerns at present revolve around several issues. First, whether the range between HKD 400 and HKD 411 is still safe, as many investors clearly view this area as a short-term defensive zone. Second, whether resistance near HKD 416 can be broken, since if the price approaches resistance but fails to stabilize, it may remain volatile at high levels. Third, whether to continue holding at current levels, waiting for further gains, or take profits on a rebound, reflecting that some short-term capital has started shifting from chasing momentum to considering profit-taking.

From a technical perspective, the current price of the Hong Kong Exchange is HKD 409, with support levels at HKD 411.00 (already breached) and HKD 408.65, and resistance levels at HKD 416.00 and HKD 423.982. The HKD 411.00 level represents a short-term inflection point. After rebounding from a low of HKD 379.00, the stock price continued to rise and has now entered consolidation after approaching HKD 416.00. The current price remains above the 5-day, 10-day, 20-day, and 30-day moving averages, indicating that the short-term structure has not significantly weakened, and overall momentum remains strong. The Relative Strength Index (RSI) stands at 54.70, showing that short-term momentum is still intact. The middle line of the Bollinger Bands is at HKD 403.57, and the current price is notably above this line, suggesting underlying structural support remains. However, the current level is no longer a low, and resistance between HKD 416.00 and HKD 423.98 persists. Until a breakout occurs, there is a higher probability of remaining volatile at high levels, making the risk-reward ratio for entering now still neutral.

For short-term positioning, the most critical factor is observing whether HKD 411.00 can hold. If the stock price can defend this level and further break through HKD 416.00, there is a short-term opportunity to test HKD 423.982. However, if HKD 411.00 is breached, attention should shift to testing support at HKD 408.65. Overall, the Hong Kong Exchange is not showing clear signs of weakness but has transitioned from an uptrend into consolidation. In this high-price range, more emphasis should be placed on timing and price levels, avoiding treating a consolidating market as a breakout scenario.

In the April 23rd 【Hong Kong Stock Podcast】 column, it was mentioned: Some investors noted that there is still an unfilled gap at HKD 390 and have positioned put warrants with an exercise price of HKD 388.68. From the chart, after previously hitting a low of HKD 379, the stock price has gradually recovered and is now clearly back above HKD 400. If support between HKD 408 and HKD 403 is lost, downward pressure will increase again, at which point the market will reconsider the possibility of testing lower levels. However, before losing this support zone, the current trend should still be viewed as stable consolidation after a rebound, without showing signs of a significant downward structure.

April 23rd [Hong Kong Stock Podcast] Part-1 - Hang Seng Index, Yanzhou Coal Energy, Hong Kong Exchange,

Market Commentary Reply:

@Willing Morton@願意的莫頓If waiting to buy around $408, technically it is close to the second support zone.

@Model Gu Tianle@型版古天樂As long as it remains above $400, the overall situation is still not bad. Technically more important is whether $411.000 can hold; if it holds, the structure has not weakened significantly.

@Yue Fei, may you be beautiful for a lifetime.@岳飛可終身美麗If the broader market weakens further, the Hong Kong Exchange will also be affected, so $411.000 will become a crucial defensive level.

@Liu FaFa@輋發發At this stage, there is indeed some back-and-forth tussle. Unless $416.000 is breached, the trend is likely to remain volatile.

@Supporting others is supporting yourself@支持別人就是支持自己If considering buying near $412, technically this would be a conservative approach before reaching the resistance zone, since $416.000 has not yet been broken.

Hong Kong Exchange (00388): Key strategy: 411.000 is the short-term watershed; if it holds steady, consolidation near the high can be expected before an upward move. If it breaks above 416.000, there’s a short-term opportunity to test 423.982. However, if it falls below 411.000, watch for a retest of 408.652.

Strategy One | Hold above 411.000 for a rebound play

26034 | Strike price 419.08 | Actual leverage 4.7x | Near current price on the upside, suitable for initial trial positions once the watershed is held, targeting the first leg of the rebound

27123 | Strike price 457.19 | Actual leverage 9.7x | Higher flexibility; if the stock price moves up from the support level, the reaction will be more direct

27920 | Strike price 480.2 | Actual leverage 9.5x | More aggressive, suitable for smaller bets focusing on acceleration before and after a breakout

$UB-HKEX@EC2609C.C (27920.HK)$$UB-HKEX@EC2609B.C (27123.HK)$$UB-HKEX@EC2706A.C (26034.HK)$

Strategy Two | Follow the trend after breaking through 416.000

26034 | Strike price 419.08 | Actual leverage 4.7x | A closer-to-price tool, suitable for the first position following a breakout

27123 | Strike price 457.19 | Actual leverage 9.7x | Higher sensitivity post-breakout, suitable for capturing an accelerating uptrend

28021 | Strike price 480.2 | Actual leverage 10.1x | Greater elasticity, suitable for aggressively chasing the trend after confirming a breakout

$UB-HKEX@EC2706A.C (26034.HK)$$UB-HKEX@EC2609B.C (27123.HK)$$CT-HKEX@EC2609A.C (28021.HK)$

Strategy Three | Turn bearish if 411.000 is breached

21985 | Strike Price 359.8 | Actual Leverage 16.9x | Quick response after breaching the critical level, suitable for capturing the initial weakening trend

27573 | Strike Price 355.35 | Actual Leverage 8.6x | Suitable for expecting a gradual retest of the support zone, balanced pace

28375 | Strike Price 349.8 | Actual Leverage 6.8x | Further out, suitable for deploying when expecting an extended downtrend with widening pullbacks

$UB-HKEX@EP2606A.P (21985.HK)$$UB-HKEX@EP2609A.P (27573.HK)$$UB-HKEX@EP2610A.P (28375.HK)$

Friendly 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 Index (800000.HK)$$Hang Seng TECH Index (800700.HK)$

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