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Kicking off the year with a bang! Multiple sectors in Hong Kong's stock market are quietly gaining m
港股窩輪Jenny
joined discussion · Jan 5 11:26

[Warrant Perspective] Semiconductor stocks collectively overbought; is it time for high-leverage put warrants to hedge?

$SMIC (00981.HK)$
On January 2, 2026, the stock closed at 75.1 yuan, surging by 5.11%, with a trading volume reaching 3.029 billion yuan, becoming one of the leading gainers in the semiconductor sector. On January 2, the semiconductor sector showed strong performance, marking one of the standout sectors on the first trading day of 2026. Among peers, $HUA HONG GRACE (01347.HK)$ surged by 9.42%, $SHANGHAI FUDAN (01385.HK)$ rose by 4.24%, $CE HUADA TECH (00085.HK)$ and $SOLOMON SYSTECH (02878.HK)$ There are also varying degrees of performance. However, it is important to note that the technical indicators of several stocks within the sector suggest overbought risks. For instance, the overall technical signal for SMIC indicates a 'strong sell,' while for Shanghai Fudan, it indicates a 'sell.' Subsequently, attention should be paid to the impact of earnings realization and industry cycle changes on the sector’s trend.
In terms of SMIC's technical aspects, the share price is currently holding firmly above the MA10 (69.2 HKD) and MA30 (68.88 HKD), with short-term moving averages showing a bullish alignment. However, the MA60 (72.63 HKD) still exerts some pressure on the share price. As of 11:00 AM today (the 5th), SMIC's latest price was 76.7 HKD, with a temporary increase of 2.13%. Resistance levels are seen at 78.5 HKD and 83.4 HKD, while key support levels are at 69 HKD and 66.8 HKD respectively. In terms of indicators, the RSI value is 58, already approaching the overbought range. The summary signals from multiple oscillators indicate 'neutral,' with the Williams %R in the overbought zone but issuing a neutral signal. Similarly, the CCI indicator signal remains neutral, while MACD and Bollinger Bands issue buy signals. Overall, the technical picture shows a balanced situation between bulls and bears.
$SMIC (00981.HK)$ On January 2, 2026, the stock closed at 75.1 yuan, surging by 5.11%, with a trading volume reaching 3.029 billion yuan, becoming one of the leading gainers in the semiconductor sector. On January 2, the semiconductor sector showed strong performance, marking one of the standout sectors on the first trading day of 2026. Among peers, $HUA HONG GRACE (01347.HK)$ surged by 9.42%, $SHANGHAI FUDAN (01385.HK)$ rose by 4.24%, $CE HUADA TECH (00085.HK)$ and $SOLOMON SYSTECH (02878.HK)$ also showed varying levels of performance. However, it's important to note that technical indicators for several stocks within the sector suggest overbought risks. For example, Huahong Semiconductor’s technical indicator summary signal shows 'Strong Sell,' while Shanghai Fudan indicates 'Sell.' Subsequent focus should be on earnings realization and industry cycle changes impacting the sector’s trend. From a technical perspective for SMIC, the share price is currently holding steady above the MA10 (69.2 yuan) and MA30 (68.88 yuan), showing a bullish short-term moving average arrangement. However, the MA60 (72.63 yuan) still exerts some pressure on the stock price. As of 11 AM today (January 5th), SMIC is trading at 76.7 yuan, up temporarily by 2.13%. Resistance levels are seen at 78.5 yuan and 83.4 yuan, while key support levels lie at 69 yuan and 66.8 yuan respectively. In terms of indicators, the RSI value is 58, nearing the overbought zone...
Reviewing the recent performance of SMIC-related warrants, several products listed on December 30, 2025, recorded notable gains two days later, significantly outperforming the underlying stock. Among them, $UB#SMIC RC2604C.C (60514.HK)$ the two-day increase reached 20%, $HS#SMIC RC2605A.C (60684.HK)$ with a 19% rise, $CI-SMIC@EC2604B.C (20292.HK)$ a 18% gain, $BI-SMIC@EC2604B.C (20316.HK)$ and an 11% increase, while during the same period, SMIC's underlying stock rose by only 3.59%. Clearly, under the upward trend of the underlying stock, the flexibility advantage of warrants and bull contracts is prominent. The high Delta sensitivity allows these products to effectively amplify the gains of the underlying stock, aligning with the income characteristics of derivatives when the underlying trend is clear.
$SMIC (00981.HK)$ On January 2, 2026, the stock closed at 75.1 yuan, surging by 5.11%, with a trading volume reaching 3.029 billion yuan, becoming one of the leading gainers in the semiconductor sector. On January 2, the semiconductor sector showed strong performance, marking one of the standout sectors on the first trading day of 2026. Among peers, $HUA HONG GRACE (01347.HK)$ surged by 9.42%, $SHANGHAI FUDAN (01385.HK)$ rose by 4.24%, $CE HUADA TECH (00085.HK)$ and $SOLOMON SYSTECH (02878.HK)$ also showed varying levels of performance. However, it's important to note that technical indicators for several stocks within the sector suggest overbought risks. For example, Huahong Semiconductor’s technical indicator summary signal shows 'Strong Sell,' while Shanghai Fudan indicates 'Sell.' Subsequent focus should be on earnings realization and industry cycle changes impacting the sector’s trend. From a technical perspective for SMIC, the share price is currently holding steady above the MA10 (69.2 yuan) and MA30 (68.88 yuan), showing a bullish short-term moving average arrangement. However, the MA60 (72.63 yuan) still exerts some pressure on the stock price. As of 11 AM today (January 5th), SMIC is trading at 76.7 yuan, up temporarily by 2.13%. Resistance levels are seen at 78.5 yuan and 83.4 yuan, while key support levels lie at 69 yuan and 66.8 yuan respectively. In terms of indicators, the RSI value is 58, nearing the overbought zone...
Combining SMIC's trends and warrant pool data, two types of high cost-performance targets in different directions have been selected for your reference.
In terms of call warrants, $CI-SMIC@EC2604B.C (20292.HK)$ The strike price is 73.85 HKD, with actual leverage of 4.9 times. Its premium and implied volatility are the lowest among similar products, demonstrating a clear advantage in cost efficiency. It is suitable for investors seeking stable deployment and focusing on cost control.
Regarding bull certificates, $HS#SMIC RC2607P.C (62371.HK)$ The strike price is 65 HKD, with actual leverage of 6.6 times. Not only is its actual leverage relatively high, but the premium is also relatively low, and liquidity performance is stable. It is a good choice for investors optimistic about SMIC breaking through upper resistance and aiming for higher elastic returns.
Moreover, if investors are concerned about a pullback after the sector becomes overbought, they can pay attention to $BI-SMIC@EP2605A.P (21097.HK)$, which has a strike price of 68.88 yuan and an actual leverage of 3.6 times, making it the highest leveraged product among put options. Additionally, its implied volatility is low, allowing it to effectively hedge against downside risks in the underlying stock.
Risk Warning:First, many individual stocks in the semiconductor sector currently show technical indicators suggesting overbought conditions. The RSI for SMIC is nearing the overbought range. If the underlying stock fails to break through the resistance level at 78.5 yuan effectively, related call warrants and bull contracts may face pullback pressures; blindly chasing high prices is not recommended. Secondly, some short-term CBBCs have shorter remaining durations, leading to accelerated time decay, especially for products near expiration — these should be held cautiously. Furthermore, most bull contracts have exercise prices concentrated around 65 yuan. If the underlying stock experiences a short-term pullback below this support level, bull contracts may face significant losses; whereas bear contracts like $SG#SMIC RP2812O.P (64168.HK)$ with an exercise price of 80 yuan, are relatively close to the current stock price of 75.1 yuan, so caution is needed regarding the risk of forced redemption triggered by a short-term rebound in the underlying stock.
$SMIC (00981.HK)$ On January 2, 2026, the stock closed at 75.1 yuan, surging by 5.11%, with a trading volume reaching 3.029 billion yuan, becoming one of the leading gainers in the semiconductor sector. On January 2, the semiconductor sector showed strong performance, marking one of the standout sectors on the first trading day of 2026. Among peers, $HUA HONG GRACE (01347.HK)$ surged by 9.42%, $SHANGHAI FUDAN (01385.HK)$ rose by 4.24%, $CE HUADA TECH (00085.HK)$ and $SOLOMON SYSTECH (02878.HK)$ also showed varying levels of performance. However, it's important to note that technical indicators for several stocks within the sector suggest overbought risks. For example, Huahong Semiconductor’s technical indicator summary signal shows 'Strong Sell,' while Shanghai Fudan indicates 'Sell.' Subsequent focus should be on earnings realization and industry cycle changes impacting the sector’s trend. From a technical perspective for SMIC, the share price is currently holding steady above the MA10 (69.2 yuan) and MA30 (68.88 yuan), showing a bullish short-term moving average arrangement. However, the MA60 (72.63 yuan) still exerts some pressure on the stock price. As of 11 AM today (January 5th), SMIC is trading at 76.7 yuan, up temporarily by 2.13%. Resistance levels are seen at 78.5 yuan and 83.4 yuan, while key support levels lie at 69 yuan and 66.8 yuan respectively. In terms of indicators, the RSI value is 58, nearing the overbought zone...
$SMIC (00981.HK)$ On January 2, 2026, the stock closed at 75.1 yuan, surging by 5.11%, with a trading volume reaching 3.029 billion yuan, becoming one of the leading gainers in the semiconductor sector. On January 2, the semiconductor sector showed strong performance, marking one of the standout sectors on the first trading day of 2026. Among peers, $HUA HONG GRACE (01347.HK)$ surged by 9.42%, $SHANGHAI FUDAN (01385.HK)$ rose by 4.24%, $CE HUADA TECH (00085.HK)$ and $SOLOMON SYSTECH (02878.HK)$ also showed varying levels of performance. However, it's important to note that technical indicators for several stocks within the sector suggest overbought risks. For example, Huahong Semiconductor’s technical indicator summary signal shows 'Strong Sell,' while Shanghai Fudan indicates 'Sell.' Subsequent focus should be on earnings realization and industry cycle changes impacting the sector’s trend. From a technical perspective for SMIC, the share price is currently holding steady above the MA10 (69.2 yuan) and MA30 (68.88 yuan), showing a bullish short-term moving average arrangement. However, the MA60 (72.63 yuan) still exerts some pressure on the stock price. As of 11 AM today (January 5th), SMIC is trading at 76.7 yuan, up temporarily by 2.13%. Resistance levels are seen at 78.5 yuan and 83.4 yuan, while key support levels lie at 69 yuan and 66.8 yuan respectively. In terms of indicators, the RSI value is 58, nearing the overbought zone...
SMIC's strong upward movement has driven the semiconductor sector higher, but technical indicators already show signs of being overbought. Would you choose low-premium call warrants to follow the trend steadily, high-leverage bull contracts for greater elasticity, or would you pre-emptively position yourself with put warrants to hedge against potential pullbacks?Feel free to leave your thoughts in the comment section! Want more analysis? Don’t forget to follow ‘HK Stock Warrants Jenny’ for daily updates!
Disclaimer: 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 shall not be liable for any loss or damage arising from reliance on the information in this article. Technical analysis merely indicates whether certain technical conditions are met; a comprehensive evaluation of asset performance should incorporate additional data. Trading decisions should not be based solely on the content of this article. Please note that past performance is not indicative of future results.
#SMIC #HongKongStocks #RealTimeAnalysis #WarrantsSelection #WarrantsStrategy #DerivativesHedging #HongKongWarrantsJenny #SMIC #SemiconductorStocks #TechnicalAnalysis
Risk Disclaimer: The above content only represents the author's view. It does not represent any position or investment advice of Futu. Futu makes no representation or warranty.Read more
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