The Hang Seng Index technical indicators collectively signal 'buy,' suggesting the market may be approaching a short-term rebound window.

On the previous day (March 23rd)$Hang Seng Index (800000.HK)$

The index closed at 24,382.47 points, down 3.54% on the day, with a trading volume of 368.677 billion yuan. Despite the sharp drop in the index, the technical indicators collectively signaled 'buy' with a strength as high as 10, showing significant divergence from the price movement.

Specifically, the Williams %R indicator is already in an oversold condition, the CCI indicator provided a buy signal within the oversold range, and the Ichimoku Cloud also suggests that a bottom may form after the sharp decline. Additionally, the momentum oscillation indicator showed a bottom divergence buy signal. Although trend-based signals like MACD and Bollinger Bands still indicate sell, overall, multiple oscillation-based indicators are showing highly concentrated oversold signals, hinting that the one-sided downtrend might be nearing its end.

In terms of key levels, the first support for the Hang Seng Index is currently at 23,862 points, and the second support is at 23,118 points. The subsequent trend will need to closely observe the support level at 23,862 points, which will be the short-term critical point to judge whether the market can successfully bottom out. Above, resistance levels can be watched at 25,367 points and 26,503 points.

Although all key blue chips fell sharply the previous day, combining technical indicator analysis revealed a rare collective 'price-falls-signal-buys' divergence pattern, broken down as follows:

1. Severely oversold stocks:

Alibaba (09988) closed at HKD 119.7, down 3.23%, with the RSI dropping to 28, indicating a buy signal strength of 11.

Ping An (02318) closed at HKD 57.5, down 6.88%, with the RSI dropping to 29, indicating a buy signal strength of 11.

HKEX (00388) closed at HKD 382.6, down 3.38%, with the RSI dropping to 31, indicating a buy signal strength of 11.

Commonality: All three RSIs have entered the severely oversold zone, indicating an extremely strong rebound demand.

2. Approaching oversold stocks:

Tencent (00700) closed at HKD 498.4, down 1.89%, with the RSI dropping to 34, showing high buy signal strength.

Meituan (03690) closed at HKD 76.55, down 3.28%, with the RSI dropping to 37, showing high buy signal strength.

HSBC (00005) closed at HKD 118.9, down 4.50%, with the RSI dropping to 37, showing high buy signal strength.

3. Moderately weak stocks:

Stocks such as Xiaomi (01810), AIA (01299), CCB (00939), and China Mobile (00941) have their RSIs in the neutral-to-weak range of 39-44, but clear buy signals indicate that downward momentum is gradually easing.

Core conclusion: Although the closing prices of all key blue chips remain below major moving averages and trends are weak, every single one has generated a 'buy' signal. This broad-based and high-intensity divergence between price declines and buy signals strongly suggests that conditions for a short-term technical rebound in the market are highly mature.

Review and Selection of Warrants and Bull/Bear Contracts

Previous review:

The Hang Seng Index put warrants recommended on March 17 performed exceptionally well, with J.P. Morgan's put warrant (22976) rising 27% over two days and BOC's put warrant (24183) increasing by 19%, precisely aligning with this round of adjustment in the Hang Seng Index.

Product Picks:

Based on the current expectation of an oversold Hang Seng Index at its bottom, here are two selected warrant products for reference:

UBS Group Call Warrant (25916): 7x leverage, exercise price at 25,000 points, with the lowest premium and implied volatility in its category, suitable for investors optimistic about a short-term rebound in the Hang Seng Index and seeking steady trading gains.

BOC Bull Certificate (68305): 23.2x leverage, recovery price at 23,488 points, offering high leverage that aligns with trading strategies targeting an oversold rebound in the Hang Seng Index, highly flexible.

Risk Warning: Warrants and callable bull/bear contracts are high-leverage derivatives with significant volatility. Investors must operate cautiously based on their risk tolerance and strictly control position sizes.

The Hang Seng Index is currently showing an oversold signal, with all blue chips signaling 'buy.' Will you take the opportunity to invest at a lower level, or will you continue to wait and see? Feel free to share your insights in the comments section.

Reminder: 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 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; a comprehensive assessment of asset performance should be conducted using additional data. Decisions to trade should not be based solely on this article. Please note that past performance is not indicative of future results.

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