HK Warrants & CBBCs Notes | Hang Seng Index hits a resistance level again, but this time, what’s most worth watching may not be whether it 'goes up or not,' but which stocks truly show strength

The market sentiment in Hong Kong stocks was actually quite subtle on Friday.

Hang Seng Index $Hang Seng Index (800000.HK)$ Up 0.53% to close at 25,668 points; HSI Tech Index $Hang Seng TECH Index (800700.HK)$ Up 0.78% to close at 4,858 points—on the surface, this clearly indicates bullish sentiment. Looking further at warrant and CBBC flows, the direction is even clearer: Hang Seng Index (HSI) call open interest rose 8.29% in a single day, bull certificates surged 13.14%, while put open interest dropped 6.39% and bear certificates fell 12.61%. The situation for the HSI Tech Index is even more pronounced—call open interest jumped 14.70%, bull certificates rose 9.64%, while bear certificates plummeted 25.60%.

That is to say,The market isn’t just rising—even warrant and CBBC capital is starting to shift toward bullish positions.

The question is—after everyone turns bullish together, is it still the best time to jump in?

According to the 'Warrant & CBBC Product Overview,' the short-term risk-reward score for the HSI is 58 and 59 for the HSI Tech Index—both leaning bullish. However, with the HSI closing at 25,668 points, its first resistance level is surprisingly just 25,669.52; similarly, the HSI Tech Index closed at 4,858 points, with its first resistance merely at 4,858.5. In other words,both indices closed almost right up against their immediate resistance levels on Friday.

Therefore, when the market opens on Monday, I wouldn’t automatically assume 'keep buying calls' just because it rose on Friday. What really matters to watch is:whether the Hang Seng Index can hold above 25,670 and whether the Hang Seng Tech Index can genuinely break through from 4,858 to 4,860.

If it breaks through, the upward move can be considered to have taken one more step; if it drops right at market open, Friday's gain might just be a rebound ahead of resistance.

This morning, I’ll also keep an eye on three stocks: CNOOC $CNOOC (00883.HK)$ , Meituan $MEITUAN-W (03690.HK)$ , NetEase $NTES (09999.HK)$

CNOOCWhich rose 2.47% on Friday, reclaiming its 5-day moving average—the technical outlook isn’t bad. However, the Product Overview shows its current price at HK$23.26, with first resistance at HK$23.36 and second resistance at HK$23.38, already very close overhead. Its short-term risk-reward score is only 45.5, still in the观望 (wait-and-see) zone.

The most interesting part is that while the underlying stock has risen nicely, call warrant open interest increased by only 0.09%, whereas bull warrant open interest actually fell by 0.24%. So I’ll treat 23.38 as a threshold:Only after it breaks through can we call it a breakout; buying calls before that point essentially means buying right in front of resistance.

MeituanThis is an entirely different story. It closed at 92.20 with no net change. Support levels are at 91.60 and 91.30, resistance at 93.20 and 93.60, and the short-term risk-reward ratio is 48.1—essentially right in the middle.

This kind of stock easily makes traders impatient: 'Should I pre-emptively bet on a direction?' But I actually think there’s no need. With such a narrow range between 91.30 and 93.60,it’s more comfortable to wait for the stock to pick its own direction before entering. Bull warrant open interest dropped by 4.54%, while bear warrant open interest rose by 4.67%—the market itself hasn’t reached a consensus yet.

On the other handNetEaseThe divergence between capital flows and share price movement is particularly worth noting.

NetEase rose 1.08% on Friday and closed above all moving averages, but open interest in calls dropped 4.30% and bull certificates fell 7.96%, while open interest in puts surged 36.29% and bear certificates also rose 8.66%. Market positioning observed is clearly more bearish than the stock price itself.

The product overview is even more conservative: NetEase’s short-term risk-reward ratio is only 46.9, with support at 204.4/203.8 and resistance at 207.4/207.6.

Therefore, today’s move in NetEase isn’t simply 'up so we stay bullish'; instead, we need to watchwhether it can break above 207.6 or fall below 203.8. Until either side is breached, I’d treat it as a stock that appears strong on the surface but hasn’t yet gained full conviction from market participants.

If using warrants or CBBCs today, the key isn’t predicting direction—it’s waiting for confirmation of conditions.

The Hang Seng Index and Hang Seng Tech Index are both leaning upward but have reached resistance levels; CNOOC has also hit resistance, Meituan remains range-bound, and NetEase shows even clearer divergence in fund flows.

So the warrant strategy today can be very simple:

– Only act on a confirmed breakout

– Only act on a confirmed breakdown

– Don’t rush to buy out-of-the-money call warrants right at Monday’s market open just because prices rose on Friday.

– Bull and bear warrants offer high leverage, but you must pay even closer attention to the knock-out distance—not just the 'multiplier'.

If you want to review everything at once before today’s market opens,including short-term risk-reward ratios, key support/resistance levels for the Hang Seng Index (HSI), Hang Seng Tech Index (HSTECH), and major stocks, as well as representative terms for call warrants, put warrants, bull certificates, and bear certificates,, remember to download today's “Warrant and Callable Bull/Bear Contract (CBBC) Product Overview”。

I think its greatest value isn’t telling you exactly what to buy, but rather ensuring that when you actually see a breakout or breakdown moment, you don’t have to scramble through hundreds of products on the spot. It’s far more practical to first know which direction you’re watching, then compare leverage, moneyness, implied volatility (IV), premium, and knock-out distance.

Overview of Warrants and CBBCs

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