[Warrant Perspective] The Hang Seng Index’s mid-term trend is flattening, while short-term bullish-bearish competition intensifies.
January 23rd,$Hang Seng Index (800000.HK)$
The day closed at 26,749.51 points, slightly up 0.45% for the day, with a 5-day volatility of 2%. The trading volume was 240.872 billion yuan, showing moderate performance. In terms of technical indicators, the RSI is at 61, within the neutral range. Indicators such as MACD and Bollinger Bands are giving buy signals, while multiple moving averages indicate a strong sell signal. Overall, the summarized signal remains neutral with a strength of 9, reflecting intense short-term market competition between bulls and bears.
In terms of support and resistance levels, the key supports below for the Hang Seng Index are 26,268 points (primary support) and 25,830 points (secondary support). Key resistances above are found at 27,146 points (primary resistance) and 27,520 points (secondary resistance). Currently, prices are hovering near the MA10 (26,724.13 points), slightly higher than the MA30 (26,152.08 points) and MA60 (26,123.99 points). Mid- to short-term moving averages are showing signs of flattening. Future focus will be on whether the index can stabilize above MA10 and break through the upper resistance levels.
Blue-chip performances were mixed on January 23, with tech stocks and financial stocks showing differing trends. The breakdown is as follows:
Technology stocks: Xiaomi Group-W (01810) was the most active, surging 2.84% in a single day to close at HKD 36.24. The RSI is only at 34, indicating an oversold condition. Technical signals suggest a buy rating with a strength of 10. Although it consolidated near the MA10 (HKD 36.83) after rebounding, clear signs of bottoming have emerged. Alibaba-SW (09988) rebounded by 2.25% to HKD 168.50. The RSI rose to 68, nearing overbought levels. Technical signals turned to sell (strength 8), and after breaking through the MA10 (HKD 163.06), a pullback risk needs attention. Tencent (00700) and Meituan-W (03690) showed weakness; the former dropped 0.42% to HKD 595, with an RSI of 40 indicating an oversold state, giving a buy signal with strength 9. The stock price remains below short-term moving averages but shows initial signs of bottoming. The latter rose slightly by 0.57% to HKD 97.55, with an RSI of 42 nearing oversold levels and a strong buy signal (strength 10). However, it remains suppressed by the MA10 and MA30, and its rebound momentum requires further observation.
Financial stocks: HSBC Holdings (00005) performed strongly, rising slightly by 0.23% to HKD 130. The RSI reached 72, entering the overbought zone, triggering a sell signal with strength 10. The stock price is far above the MA10 (HKD 127.75), suggesting an increased risk of a pullback despite its strong performance. China Construction Bank (00939), AIA (01299), and Ping An (02318) showed stable performances. CCB closed flat at HKD 7.61, with an RSI of 44 and a buy signal strength of 9, hovering around the MA10. Both AIA and Ping An showed neutral technical signals, with the former rising 0.67% to HKD 83.05 and the latter slightly increasing by 0.15% to HKD 67, both in a balanced state between bulls and bears. HKEX (00388) dropped by 1.03% to HKD 422, with an RSI of 48 showing a neutral signal. The stock price is below the MA10, showing weak momentum but approaching the oversold region, indicating potential for a rebound worth watching.
Review and Selection of Warrant and Bull/Bear Products
(1) Review of Previous Products
Reviewing the two Hang Seng Index bull contracts recommended on January 21, their short-term performance was impressive. The BOC bull contract (63489) gained 14% in two days, while the BOC bull contract (63488) surged even higher by 15%. In contrast, the Hang Seng Index rose only 0.62% during the same period, fully demonstrating the leverage characteristics of warrant products that bring excess returns to investors. It’s important to note that leveraged products are highly volatile, with both high returns and risks.
(II) Today's Product Highlights
Considering the neutral trend of the Hang Seng Index on the day and the long-short game landscape, we have selected two call warrant products for investors' reference:
1. BOC Call Warrant (23128): Leverage of 13.4 times, strike price at 28,341 points. The core advantage of this product lies in its lowest implied volatility, minimizing downside risks in a relatively stable market volatility environment. Its leverage level is within a reasonable range, making it suitable for investors optimistic about the Hang Seng Index breaking through upper resistance.
2. JPMorgan Call Warrant (22977): Leverage of 12.5 times, strike price at 28,200 points. This product offers the highest leverage and the lowest premium within the selection range, showcasing a significant cost advantage. It is more suitable for investors seeking high-leverage returns who can tolerate corresponding volatility risks.
Risk Warning:Warrant products have expiration dates and exercise price restrictions. Investors should rationally choose based on their own risk tolerance and market judgment, while closely monitoring the performance of the underlying stock and the liquidity of the product.
Share your experience:When choosing between bull and bear warrants, do you prioritize leverage multiples or implied volatility (premium)? Share your thoughts in the comments section.
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.
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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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