March 24 [HK Stocks Podcast] Part 2 - AAC Technologies, Weichai Power, Changfei Fiber Optic Cable
4. AAC Technologies (02018.HK): What is the short-term trading range? Investors are looking at a target of 40 HKD, holding call warrants with an exercise price of 42.08 HKD.
AAC Technologies is currently trading at 34.78 HKD, with a recent obvious trading range between 31.20 HKD and 40.70 HKD, showing overall volatility of approximately 30.4%. From a short-term trading perspective, the stock price is currently in the lower-middle part of this range. Immediate support is around 33 HKD to 32.50 HKD, followed by 31.20 HKD as the recent clear low. Resistance above is first seen in the 35 HKD to 35.90 HKD region, as this area represents dense pressure after a short-term rebound. Beyond that, resistance lies near 37 HKD, followed by the larger resistance zone between 40 HKD and 40.70 HKD.
Technically, the moving averages are still trending downward, indicating that the overall trend has not completely shaken off weakness. The Relative Strength Index (RSI) is currently neutral, reflecting that the stock price has stabilized from its lows but has not yet shown a strong continuation signal. Regarding the Bollinger Bands, the price is close to the middle band, suggesting that the stock is closer to a consolidation and recovery phase rather than entering a sharp one-sided uptrend. In other words, AAC Technologies is not at its weakest point right now, but it hasn't fully turned strong either; in the short term, it remains in an observation period for whether the rebound can continue.
If further upward movement is to occur, the conditions are clear: the stock price must first effectively stabilize above the resistance zone of 35 HKD to 35.90 HKD, then break through near 37 HKD before the market can consider pushing the short-term target towards 40 HKD. This means that reaching 40 HKD won’t happen automatically with just a simple rebound from current levels—it requires successive breakthroughs of several resistance levels for the short-term trend to truly reverse. If the price only rises to slightly above 35 HKD before quickly pulling back, this would still be considered a bounce within the trading range, insufficient to support a direct challenge towards 40 HKD.
The downside risks are also clear. If the stock price falls back below the 33 to 32.50 range, it indicates insufficient short-term recovery momentum. If it breaks below 31.20 again, the entire rebound structure will be disrupted, and the market may return to a weak bottom-searching state. Since the moving averages are still trending downward, once support levels are broken, selling pressure might not build gradually but could instead accelerate again.
Regarding warrant capital distribution, there are 34 products in the market, including 26 call warrants and 8 put warrants, with a clear bias toward call warrants. The most traded call warrants have strike prices between 46 and 46.99, while for put warrants, they are concentrated at 40 to 40.99. This reflects that although more capital is positioned for a rebound, the call warrant positions are set relatively high, indicating an aggressive upward-looking strategy. Bearish capital, on the other hand, is concentrated near stronger resistance zones, showing defensive positioning. In terms of open interest, call warrants are mostly concentrated at 45 to 45.99, while put warrants are at 31 to 31.99, showing a one-sided concentration because the market’s holding structure clearly favors calls. In other words, overall market sentiment isn’t uniformly bearish, but rather, more capital still prefers waiting for a rebound, though deployment is higher, meaning while everyone expects upside potential, they’re also waiting for clearer breakout signals.
As for investors asking about the short-term volatility range, I would say directly that a more realistic short-term range should initially be between 31.20 and 35.90. If it breaks above 35.90, the range could expand to 31.20 to 40. This means 40 can serve as the next target, but it shouldn't be viewed as the immediate natural level. Looking at 40 makes sense directionally since 40 itself is near the upper end of the recent range. If the stock price successfully breaches resistance levels consecutively, it indeed has room to test higher levels. However, at the current price of 34.78, there’s still some distance to 40, and intermediate pressures at around 35, 36, or even 37 must be addressed first. Therefore, this view is somewhat aggressive.
Holding a call warrant with a strike price of 42.08 is also an aggressive position, as 42.08 is already higher than the 40 target that investors typically expect. In other words, even if the stock price reaches 40, these types of products may not directly reflect short-term upward movements due to their relatively high strike price. Simply put, while the upward direction is understandable, from the perspective of short-term value betting, holding call warrants with a higher strike price like 42.08 offers only average value unless the stock first breaks through the 35 to 37 range and maintains upward momentum. At this stage, it's more appropriate to treat 40 as a longer-term target rather than an immediate or very short-term objective. $JP-AAC @EP2612A.P (16602.HK)$$CI-AAC @EP2612A.P (15967.HK)$
5. Weichai Power (02338.HK): Investors have observed large orders flowing in for two consecutive days. What’s the next target price? In the warrant market, some investors are eyeing call warrants with a strike price of 28.4.
Weichai Power is currently trading at 27.54. Recently, its clear operating range has been between 18.67 and 35.54, representing a total fluctuation of approximately 90.4%, making it a relatively volatile stock. Focusing on the short term, the stock is now at a recovery point after a pullback from the upper-middle part of the range. Immediate support below is around 26.05 to 25.80, which is near intraday lows and a short-term stabilization zone. Below that, watch for support near 25. Above, initial resistance is at 27.78, followed by the key psychological level of 28, and then the larger resistance zone between 29.2 and 30. In other words, despite some rebound, the stock hasn’t truly broken through short-term pressure areas yet.
Technically, the moving averages remain downward, indicating that the medium- to short-term trend hasn’t fully strengthened yet. The relative strength index is neutral, reflecting rebound momentum after a low but not entering a strong bullish phase. Regarding Bollinger Bands, the price is near the middle band, suggesting the current movement resembles a post-weakness recovery and consolidation rather than a renewed one-way sharp rise. In simple terms, Weichai Power isn’t the weakest, but technically it’s still in a verification phase regarding whether the rebound can continue.
For further upward movement, the conditions are clear: the stock must stabilize above 27.78 and effectively break through the key level of 28. Only by achieving this can the market push the short-term target above 29 and gradually aim for around 30. If the price merely spikes to 27.8–28 intraday without closing above, this move remains just a rebound within the range and isn’t enough to confirm a new uptrend. In other words, the area around 28 is the crucial trigger point; breaking through or not directly impacts the next target price.
Downside risks are also evident. If the stock price falls back below 26.05, it means today’s rebound couldn’t continue, showing insufficient short-term buying support. If it breaks below 25 again, this round of recovery could weaken further, potentially returning the market to a weaker consolidation pattern. Since the moving averages are still trending down, once support is broken, the pullback might not be minor but could expand significantly.
Regarding warrant capital distribution, there are 19 products in the market, all of which are call warrants with no put warrants, clearly reflecting a highly concentrated market direction. The most traded call warrants have strike prices between 28 and 28.99, close to the current price, indicating that mainstream capital is positioning for continued upward movement after breaking through 28. In terms of open interest, the highest concentration is in the 38 to 38.99 range, much higher, showing that significant funds are waiting for a larger rebound from aggressive levels. Overall, this market structure leans heavily toward an upward outlook, as there are no put warrants diverting attention, and trading is concentrated slightly above the current price, indicating that funds aren’t just looking at technical rebounds but are anticipating further upward movement.
As for investors observing that there have been large orders flowing in for two consecutive days, the next target price should be looked at step by step. In the short term, the first target is between HK$28 and HK$28.5. If it can stabilize effectively, then the next reasonable range would be HK$29.2 to HK$30. The reason is simple: the current price of HK$27.54 is already close to HK$28, and the most concentrated call warrant strike price in market trading is between HK$28 and HK$28.99, indicating that this region is the most natural first stop. If HK$28 can be broken through and stabilized, the market will have grounds to push the target higher; but if even HK$28 cannot be stabilized, it's too early to aim directly for higher levels. In other words, investors seeing two consecutive days of large inflows and being optimistic about the future trend is not unreasonable, but the target price should be approached incrementally rather than jumping too far ahead all at once.
As for investors focusing on a call warrant with a strike price of HK$28.4, this choice itself is reasonable because HK$28.4 is close to where market trading is concentrated, as well as near a short-term breakout level. It reflects a deployment corresponding to the current trend, rather than an overly aggressive choice. However, whether the short-term reward-to-risk ratio is attractive still depends on whether the stock price can first stabilize above HK$27.78 and break through HK$28. If the breakout holds, the call warrants at HK$28.4 will naturally have more room to perform. But if the stock price merely tests HK$28 before retreating, the efficiency of such products in the short term would diminish. Overall, a bullish outlook could hold, and the HK$28.4 call warrant falls within a reasonable focus range, offering moderate upside potential, but only on the premise that the HK$28 level must be broken. Otherwise, it remains a rebound that has yet to be confirmed.
6. Yangtze Optical Fibre and Cable (06869.HK): Investors are asking whether after three days, with earnings coming up, the stock can reach HK$180? Holding call warrants at HK$188.88.
Yangtze Optical Fibre and Cable’s current price is HK$165, with a recent obvious trading range between HK$45.64 and HK$206.8, showing overall volatility of approximately 353.1%, making it a highly volatile stock. Looking at the short term, the share price is currently consolidating near its highs before attempting another upward move. Immediate support below is around HK$158.8 to HK$160, with further support at HK$149.4, which represents the intraday low. Resistance above is initially at HK$166.2, followed by the range of HK$170 to HK$174.5. The HK$180 level that investors are watching is a higher target and won’t automatically be reached just from an uptick in the current price.
Technically, the moving averages are still sloping upwards, indicating that the foundation for a medium- to short-term uptrend hasn’t been disrupted. The Relative Strength Index (RSI) is in a relatively strong region but hasn’t reached extreme overbought levels, suggesting there’s still upward momentum in the market. Regarding Bollinger Bands, the price is running close to the upper band, typically signaling that the trend remains strong. However, it also means that chasing higher prices in the short term will require stronger breakout momentum because failure to push higher when near the upper band often leads to initial fluctuations or pullbacks.
For further upward movement, the conditions are clear: the stock price must first stabilize above HK$166.2, and then effectively break through the resistance zone of HK$170 to HK$174.5, allowing the market to challenge HK$180. In other words, HK$180 isn’t the immediate first target; instead, nearby resistance levels need to be overcome, and buying momentum must continue for there to be any chance of pushing toward HK$180 around earnings time. If the stock continues to oscillate between HK$165 and HK$170 without breaking convincingly past HK$174, this movement should only be regarded as consolidation at high levels, insufficient to confirm a direct short-term rise to HK$180.
Downside risks are equally evident. If the stock price falls back below HK$160, it indicates insufficient continuation of the short-term uptrend. If it breaks below HK$149.4, the entire bullish consolidation pattern will begin to deteriorate, potentially leading to a deeper correction from high-level consolidation. Given the stock’s inherent high volatility, once support levels are breached, the speed of the pullback might be rapid. Hence, the HK$160 level is a crucial short-term defensive position.
Regarding the distribution of CBBC (Callable Bull/Bear Contracts) funds, there are a total of 32 products in the market, all of which are call warrants, with no put warrants — clearly reflecting a highly concentrated market direction. The most active trading in call warrants is for strike prices between HK$299 and HK$299.99, while open interest is most concentrated between HK$208 and HK$208.99. This distribution shows that the market isn't just focused on small fluctuations of one or two dollars, but rather tends to deploy more aggressively for higher target prices. In other words, capital flow directions are quite consistent, leaning towards bullishness, though the positioning is on the higher side, reflecting optimistic market sentiment. However, it also implies that if upward momentum doesn't sustain in the short term, the performance of these deep out-of-the-money structures may not be ideal.
As for investors asking whether the stock can reach HK$180 in three days following the earnings report, my view is that it’s possible to test that level, but it shouldn’t be considered a certainty. The current price of HK$165 is still HK$15 away from HK$180, representing an increase of over 9%. For a stock already at a high level, this isn’t a minor fluctuation. Multiple resistances at HK$166, HK$170, and HK$174 must first be broken through before the market can push further. Technically, the direction isn’t pessimistic: moving averages are sloping upwards, RSI is strong, and the price is near the upper Bollinger Band, so aiming for HK$180 isn’t entirely baseless. However, compressing the timeline to three days and adding pre-earnings uncertainty makes this target notably ambitious.
As for holding call warrants at HK$188.88, this is also an aggressive deployment. HK$188.88 is not only higher than the current price but also above the HK$180 target that investors are watching. Even if the stock does reach HK$180, this type of product might not be the most direct reflection of short-term upward movement. In short, the bullish direction is understandable, and the market’s capital flow is clearly biased towards calls. However, in terms of short-term reward-to-risk, holding call warrants with a higher strike price like HK$188.88 is moderately aggressive. The stock must first break through the resistance zone of HK$170 to HK$174, and strong upward momentum post-earnings is required for this position to become truly advantageous. Overall, HK$180 can be a target after further breakout, but it shouldn’t be seen as a high-probability outcome within three days. As for the HK$188.88 call warrant, the direction isn’t necessarily wrong, but the short-term reward-to-risk ratio is only moderately aggressive.
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 combine other data and should not solely rely on this article to make trading decisions. Please note that past performance is not indicative of future results. Follow Jenny's insights on Hong Kong stock warrants for more professional analysis.
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