The buy signal for the Hang Seng Index diverges from the weak market pattern, as the market faces a directional decision.

Previous day (March 26th) $Hang Seng Index (800000.HK)$

General decline nearing the lower part of the range. Key blue chips show clear divergence; oversold stocks display buy signals while strong stocks flash warnings; short-term outlook is neutral.

In our 【HK Stock Broadcast】, we commented on the Hang Seng Index: it closed at 24,856.43 points yesterday, still running within the recent obvious range of 24,203.54 to 27,325.98 points in the short term, with an overall range fluctuation of about 12.9%. Based on the current price level, the index is already close to the lower half of the range, reflecting that the market has not fully recovered after the previous pullback. The short-term support level is around 24,200 points, which is quite near the recent low. If this level is breached again, it indicates that selling pressure has not been fully absorbed. The resistance level above is initially seen between 25,000 and 25,200 points; if the index can regain a firm footing there, it may have the opportunity to further test the area near 25,500 points. At present, the index is still running within a weak range and has not yet escaped the downward pressure pattern.

From a technical structure perspective, the moving averages continue to point downwards, indicating that the medium- and short-term trends have not reversed, and the rebound can only be regarded as a technical recovery within a weak trend. The closing price of 24,856.43 points is below MA10 (25,362.69 points), MA30 (25,979.5 points), and MA60 (26,333.12 points), confirming the persistent weak pattern.

In terms of momentum indicators, the RSI is at 41, which is in the weaker region, showing insufficient market support and caution from investors regarding upward price pursuit. The Bollinger Bands show signs of narrowing, with prices close to the lower band, indicating that although the index has fallen near the short-term weak area, no clear strengthening signal has emerged yet, leaving only the possibility of a short-term technical rebound.

Key Observation: The Hang Seng Index fell 1.89% the previous day, with a turnover of HKD 261.662 billion. Technical indicators gave a 'buy' signal (strength 8), suggesting the potential for bottoming after a short-term oversold condition, but it needs to hold above the 24,200-point threshold.

The Hang Seng Index is currently in a weak range, with the 24,200 to 25,000-point area being a key short-term zone. Investors should focus on the support and breakout situation within this range.

On March 26, key blue-chip stocks generally declined, with only AIA slightly up and China Mobile (00941) closing flat. Technical signals showed significant divergence. Below is a brief analysis of core individual stocks:

1. Tencent (00700): Closed at HKD 495.6 (down 1.96%), below all major moving averages. RSI is 35 (approaching oversold), signal is Buy (strength 11), rebound momentum is accumulating after an oversold condition.

2. Alibaba (09988): Closed at HKD 123.0 (down 4.58%), below all major moving averages. RSI is 36 (approaching oversold), signal is Buy (strength 9), conditions for a rebound have accumulated.

3. Meituan (03690): Closed at HKD 86.7 (down 3.67%), above MA10 and MA30 but below MA60. RSI is 62 (neutral to strong), signal is Sell (strength 9), profit-taking pressure is evident.

4, AIA (01299): Closed at HKD 87.0 (up 0.23%), above all major moving averages, RSI at 56 (neutral to slightly strong), neutral signal (strength 8), may need short-term adjustment.

5. Ping An (02318): Closed at HKD 58.15 (down 3.80%), below all major moving averages. RSI is 35 (approaching oversold), signal is Buy (strength 8), a technical rebound is expected.

Overall Observation: Oversold blue chips like Tencent, Alibaba, and Ping An are showing buy signals, while previously strong stocks such as Meituan (03690) and CCB (00939) are showing sell signals, indicating significant internal divergence among blue chips.

Warrant review and selection: Be cautious with Hang Seng Index-related products

Let's first review the performance of the Hang Seng Index-related bull/bear products recommended earlier: The Hang Seng-related products recommended on March 24 saw solid gains. UBS bear certificate (60799) and Bank of ** certificate (61183) both rose by 21% two days later, while J.P. Morgan put warrant (22976) rose by 16% over the same period, aligning well with the Hang Seng Index movement that day.

Here are two more selected HSI-related warrant products for your reference:

First: BNP Paribas call warrant (23939), leverage 17.3, strike price 26,600, with the lowest premium and implied volatility, suitable for investors optimistic about a short-term rebound in the Hang Seng Index.

Second: J.P. Morgan bear contract (60547), leverage 22.8, stop-loss level at 25,780, with high actual leverage and low premium, suitable for investors concerned about further adjustment in the Hang Seng Index.

Risk Warning: The leverage of Hang Seng Index (HSI) warrants is generally high, whether for call or put options. Always remember to set stop-loss and act within your means.

The divergence between the 'Buy Signal' and 'Weak Trend' of the HSI — which side do you believe in?

A. The signal takes precedence; follow the buy signal to bet on a rebound.

B. Trend is key; continue to wait as the downtrend remains unchanged.

C. Wait for a drop below 24,200 to confirm weakness.

D. Wait for a rise above 25,000 to confirm strength.

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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