Xiaomi (01810) Short-term Analysis: Rally Faces Resistance, Support Being Tested

Xiaomi (01810) is trading at HKD 31.72, down 4.56%, with a turnover of HKD 6.5 billion, indicating active market trading but significant selling pressure. From a technical perspective, after rebounding from the earlier low of HKD 31.1 to near the high of HKD 36.1, the stock failed to make further upward progress and has now retreated below all key moving averages. The short-term moving averages MA10 and MA30 are at HKD 34.1 and HKD 34.61 respectively, forming resistance, while MA60 sits at HKD 35.96, confirming substantial overhead resistance.

Based on multiple technical indicators, the system has issued a 'Buy' signal with an intensity of 10. However, several oscillators such as the Williams %R and Stochastic Oscillators show that the stock is in an 'oversold condition.' The CCI indicator has also issued a 'Buy' signal, reflecting potential demand for a technical rebound following a sharp short-term decline.According to technical analysis data, short-term support levels are located at HKD 31.1 and HKD 28.5, while resistance levels are at HKD 34.6 and HKD 36.1. The probability of an upward movement is 46%, with a 5-day volatility of 15.6%, indicating relatively high stock price fluctuations.

Integrating insights from the March 19 episode of [Hong Kong Stocks Podcast], the program clearly stated that Xiaomi’s stock price was around HKD 36, in a rebound phase rather than a medium-term uptrend, with overlapping resistance zones near HKD 36.2 from the mid-term moving average and upper Bollinger Band. The analysis suggested that the range of HKD 34 to HKD 34.5 had formed short-term support, while more critical support remained in the low area of HKD 31 to HKD 32. If unable to break through the resistance zone of HKD 36.5 to HKD 37 effectively, the stock price may easily retreat again to consolidate near HKD 34. Currently, the stock price has fallen back to HKD 32.22, breaking below the short-term support zone mentioned in the podcast, further testing the critical support level of HKD 31.1, validating the program's judgment of 'late-stage rebound at highs' and 'limited upside space.' On the market news front, today (March 23), Hong Kong stocks performed weakly overall, with tech stocks under broad pressure; major weighted stocks like Tencent and Alibaba experienced notable declines, increasing risk aversion sentiment, adding extra pressure on Xiaomi’s stock price.

Reviewing the performance of the warrant market, according to the product review on March 19, the four products mentioned that day recorded significant increases over the following two days (up to March 21), successfully capturing the downside trend of the underlying stocks. Among them, UBS Group put warrants (23061) surged 149%, standing out as the top performer; BOC put warrants (13235) also gained 106%; JPMorgan Chase bear certificates (55682) and UBS Group bear certificates (69732) rose by 91% and 86%, respectively. During the same period, the underlying stock fell by 11.29%, demonstrating that the relevant put warrants and bear certificates effectively served their hedging and downside-capturing functions. This shows that in a clear downtrend, appropriate derivatives can significantly amplify returns.

Based on technical analysis, market environment, and insights from podcasts, Xiaomi's stock price is currently weak in the short term, testing support at 31.1 yuan. Investors who believe the stock can stabilize at this level and rebound may consider deploying bull certificates or call warrants. If they expect the stock to further test support at 28.5 yuan, they should focus on bear certificates or put warrants. Below is an analysis of several warrant and bull/bear certificate products with relatively clear terms, where the stop-loss levels and strike prices are closely related to technical support and resistance levels:

For bullish deployment, consider HSBC call warrants (22791)$HSXIAMI@EC2612C.C (22791.HK)$ and BOC call warrants (13186)$BIXIAMI@EC2612A.C (13186.HK)$. Their strike prices are 37.12 yuan and 37.15 yuan, respectively, both higher than the second resistance level of 36.1 yuan, making them out-of-the-money structures. The advantage of HSBC call warrants (22791) lies in its lowest premium, with favorable implied volatility and leverage; BOC call warrants (13186) stand out for having the lowest implied volatility and relatively higher leverage. Both offer a leverage of 4.5 times, suitable for investors expecting the stock to break through resistance and reclaim the 36-yuan level. For those looking to deploy closer to the support level, consider bull certificates with a stop-loss price of 30 yuan, such as HSBC bull certificates (58641) and UBS Group bull certificates (67825). HSBC bull certificates (58641) have the advantage of high actual leverage (10.8 times) and low premium; UBS Group bull certificates (67825) provide a relatively higher-leverage option (10.4 times). Both have stop-loss prices below the first support level of 31.1 yuan, offering some buffer space.

For bearish deployment, consider BOC put warrants (13235)$BIXIAMI@EP2606B.P (13235.HK)$ and UBS Group put warrants (23061)$UBXIAMI@EP2605A.P (23061.HK)$. Their strike prices are 31.88 yuan and 31.28 yuan, respectively, both close to the first support level of 31.1 yuan, making them near-the-money to slightly out-of-the-money structures. The advantage of BOC put warrants (13235) lies in their lowest implied volatility and high leverage (5.6 times); UBS Group put warrants (23061) offer relatively higher leverage (7.2 times), suitable for investors expecting the stock to further test the second support level of 28.5 yuan. For bear certificates, consider Societe Generale bear certificates (59190) and Morgan Stanley bear certificates (59757), with stop-loss prices of 38 yuan and 38.5 yuan, respectively, both above the second resistance level of 36.1 yuan, providing a larger safety margin. Societe Generale bear certificates (59190) stand out for having the lowest premium and relatively high actual leverage (6.3 times); Morgan Stanley bear certificates (59757) are highlighted by their highest actual leverage (5.8 times) and lower premium.

Overall, Xiaomi is at a critical moment of testing support in the short term. Investors should use 31.1 yuan as the short-term bullish-bearish dividing line. A breach below this level could lead to a drop towards 28.5 yuan; if it holds steady, there is potential for a rebound to challenge the resistance at 34.6 yuan. When choosing derivative products, investors should balance leverage with the distance to the stop-loss/strike price based on their judgment of the market direction and strength.

Interactive Questions

Do you think Xiaomi (01810) can hold the support level at 31.1 yuan in the short term?

A. Yes, oversold technical conditions could lead to a rebound

B. No, weakness in the broader market will drive further downside tests

Feel free to leave your thoughts in the comments section and follow Jenny's HK Stock Warrants for more professional insights.

Disclaimer: This article does not constitute any investment advice. It is for reference only and does not constitute any investment advice. Market data, opinions, and analyses contained herein may change at any time without prior notice. We are not responsible for any losses or damages caused by reliance on the information in this article. Technical analysis shows whether some technical conditions are met, but should be combined with other materials for comprehensive evaluation of asset performance. Trading decisions should not be based solely on this article. Note that past performance is not indicative of future results. Follow Jenny's HK Stock Warrants for more professional insights.

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