The psychological level of 26,000 for the Hang Seng Index has been breached again, and the market sentiment is shifting from expecting a V-shaped rebound to worrying about a retest of 25,500.

$Hang Seng Index (800000.HK)$The market sentiment has clearly started to weaken recently. The key issue is not how much it has fallen, but that the market’s 'confidence in a rebound' is beginning to decline. As seen from the chart, the Hang Seng Index closed at 25,962 points yesterday, down 426 points or 1.62%. The daily line has dropped back below the 20-day moving average at 26,164 points and is approaching the middle Bollinger Band. For some time, the market had been relying on 26,000 points as psychological support, but after breaking below this level this time, investor sentiment has gradually shifted from expecting a V-shaped rebound to worrying whether 25,500 points or even lower levels might be tested again.

From a technical perspective, the upper Bollinger Band is currently around 26,666 points, while the lower band is approximately 25,661 points, and the current price is close to the middle-lower range. The 10-day moving average is about 26,272 points, the 20-day moving average is around 26,164 points, and the 30-day moving average is approximately 25,996 points, indicating that short-term moving averages are starting to converge again, weakening the previous rebound structure. Particularly, after the bearish candle broke below 26,000 points, the market's short-term outlook has turned conservative once more.

Regarding the RSI, the short-term RSI is in the range of 36 to 49, not yet reaching extreme oversold levels, indicating that although the market is weak, it has not fallen into complete panic. This also explains why there are currently two completely opposite sentiments being expressed, such as '25,800 won’t break' and 'we could see a V-shaped recovery,' versus 'Monday opening at 25,500.'

The bullish side still mainly believes in the effectiveness of the support zone between 25,800 and 26,000. Some investors think 'it won't fall further,' 'big players are just shaking out the bulls,' 'southbound capital is buying aggressively,' and 'closing above 26,000,' reflecting that some still believe this is just a short-term shakeout. In particular, mentions like 'the bulls have already gained 100 points' and 'Brother Sihai: bull forces regaining strength' indicate that there is still significant short-term capital betting on a rebound.

However, bearish sentiment has started to gradually spread. An increasing number of market participants are beginning to question: 'Everyone is bullish, so when will the pullback come?', '25,500 on Monday', 'Downside outperforms upside', 'Keep smashing'. These types of comments indicate that the market is no longer just worried about a pullback but is starting to question whether this upward trend has already run its course. Especially as the Hang Seng Index has been unable to break through previous highs recently, leading many investors to believe the market is simply in a large range-bound consolidation rather than an extended bull market.

The most critical support level currently is the 25,800 to 25,661-point region. The 25,800-point mark has already become the market's core psychological level, while the lower Bollinger Band at 25,661 points serves as technical support. Once this area breaks down, the market could easily revisit 25,500 or even the previous low around 24,203 points. Conversely, if the Hang Seng Index can regain and stabilize above 26,164 to 26,272 points — which represent the 20-day and 10-day moving averages — market sentiment might have a chance to improve again.

In terms of trading volume, turnover exceeded 325.3 billion yesterday, reflecting that there is still significant capital activity, but no clear signs of one-sided panic selling. This also indicates that the current market is more like high volatility rather than a complete collapse. However, higher trading volumes without an upward breakout suggest increasing downward pressure.

The most common question in the market right now is whether the 25,800-point level will hold, if the 26,000-point mark can be reclaimed, and whether this is just a large-scale shakeout of bullish positions. Technically speaking, near 25,800 points, we are approaching a key support zone, so there is still potential for a short-term technical rebound. However, if the rebound fails to stabilize above 26,272 points, it would indicate that the market remains in a weak consolidation phase rather than transitioning into a strong upward trend.

Additionally, the market has recently been impacted by external news and geopolitical risks. Mentions of factors like Hormuz, crude oil, and the World Cup reflect how sensitive the market currently is to external developments. In this environment, the Hang Seng Index is prone to high volatility with rapid rises and falls in the short term.

Overall, the Hang Seng Index has now entered a more sensitive position. If the 25,800 to 25,661-point region holds firm, the market may still have a chance to rechallenge levels above 26,200 points; however, if it breaks down, market sentiment could weaken quickly, potentially retesting 25,500 or even lower levels. At this stage, the short-term strategy leans more towards range trading and risk control, rather than emotionally chasing bullish bets with heavy positions.

For call warrants, consider paying attention to $UB-HSI @EC2609B.C (27924.HK)$) and$HS-HSI @EC2609A.C (27959.HK)$Both have a strike price of 27,336 points, with leverage of 12.8 times and 13.1 times respectively. These two products have relatively low premiums and are suitable for investors who are optimistic about the Hang Seng Index's future performance and wish to deploy a rebound strategy at a lower cost.

For put warrants, $BI-HSI @EP2608A.P (26491.HK)$ And, $UB-HSI @EP2608A.P (26468.HK)$The strike prices are both at 24,378 points, with leverage of approximately 11.7 times and 11.5 times respectively, also offering the advantage of relatively low premiums. If investors anticipate a market correction, they can use these to hedge risks or capture downside opportunities.

Bull certificate selection,$UB#HSI RC28124.C (54865.HK)$ With a recovery price at 25,000 points and leverage reaching 27.6 times, it is the product with the lowest premium and relatively higher actual leverage. $BI#HSI RC2809I.C (55296.HK)$ The recovery price is 24,990 points with leverage of 26 times, and the premium is also relatively low. These two bull contracts are suitable for aggressive investors who anticipate a short-term rebound and can tolerate the risk of recovery.

In terms of bear contracts, $BI#HSI RP2804M.P (61185.HK)$ The recovery price is 26,905 points with leverage of approximately 23.6 times; $UB#HSI RP2810G.P (59535.HK)$ The recovery price is 26,888 points with leverage of about 24.5 times; both have relatively low premiums. If it is determined that the Hang Seng Index faces significant upward resistance, these bear contracts can be used to capture a pullback while managing risk by considering the distance between the recovery price and the current price.

Overall, the above products stand out in their respective categories for having either low premiums or high leverage. Investors can choose appropriate tools based on their market outlook, risk tolerance, and price sensitivity.

@231250349If it dips lower but holds above 25,661 points, there could indeed be another technical rebound.

@KennethBMAt present, the Hang Seng Index is starting to show some divergence from certain stocks.

@熊小俠If the 25,800-point level holds, short-term bulls may still have a chance to counterattack.

@31238852The market’s biggest concern now is that after holding steady, prices might suddenly crash through support levels.

@升跌專家The 25,000-point level currently represents a more pessimistic scenario, with the premise being the breach of the 25,661-point level.

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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 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; asset performance should be comprehensively evaluated using other sources of information, and trading decisions should not be made solely based on this article. Please note that past performance is not indicative of future results.

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