Hong Kong stocks are rebounding—what sectors deserve attention?

港股窩輪Jenny

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HSI CBBC Special Report | 25,288 is just the first hurdle; the real level to defend is the heavy concentration of bull contracts at 25,000

Today, the Hang Seng Index $Hang Seng Index (800000.HK)$ Further decline, closing at 25,396.51 points。

On the surface, the drop was only 0.17%, which seems insignificant. However, this marks the third consecutive day of declines, with today's low reaching 25,288.07 points, bringing the market to a rather sensitive position.

Just below lies the heavy concentration zone for bull contracts.

What truly deserves attention this time is not just today's low of 25,288, but rather:

the 25,000 to 25,199 point range.

First support level: 25,288

Today's low of 25,288 represents the shortest-term technical support line.

If the market can hold above this level after tomorrow's open, it indicates that there is still buying support at today's low. However, if it breaks below, market attention will naturally shift downward immediately.

The next key level coincides with the heavy concentration zone for bull contracts.

Second support level: The 25,000–25,199 bull contract zone

The latest data on heavy concentration zones shows that Hang Seng Index bull contracts are most concentrated in the 25,000–25,199 point range; whereas the heavy concentration of bear contracts is far away at the 26,300–26,499 point range。

This distribution is quite interesting.

The Hang Seng Index is currently at 25,396, which is not far from the heavy concentration zone of bull contracts.

Therefore, if the 25,288 level is breached, the next leg down may not just be a technical chart issue, but rather a move closer to the mass call price levels of bull contracts.

Volatility tends to amplify in such situations.

It's not because "market makers must squeeze the bulls," but rather that when the market knows there is a large cluster of near-the-money bull contracts in a certain area, traders become more sensitive. As prices drop near that zone, stop-loss orders, sell orders, and short-term short positions emerge simultaneously, naturally leading to expanded volatility.

If this level is also breached, watch 24,672.

Today's lower Bollinger Band is approximately at 24,672 points。

So the overall downward structure is actually very clear:

25,288 → 25,000 to 25,199 → 24,672

If the heavy concentration zone for bull contracts at 25,000 holds, a rebound is still viable.

However, if 25,000 is breached, the next technical support zone to watch will drop sharply to around 24,600–24,700.

Therefore, for those holding bull contracts, the primary concern now is not "whether the Hang Seng Index will rebound."

But rather:

The key question is whether your chosen call price can withstand a normal test of the 25,000 level.

Look to 25,519 as the initial upside target; don't aim for 26,000 right off the bat.

Today's high was 25,519.39 points, while the Bollinger Bands middle line is approximately 25,469 points。

Therefore, if there is a rebound tomorrow, the first step is not to immediately fantasize about returning to 26,000, but rather to see if the index can regain stability in the 25,470–25,520 range.

If it fails to hold above this level, the Hang Seng Index will merely be experiencing a weak rebound.

The real major resistance to further upside lies in the heavy bear contract zone. the 26,300–26,499 point range。

In other words, today's key support and resistance range for the Hang Seng Index is actually quite clear:

Below: 25,000 bull contract zone

Above: 26,300 bear contract zone

The current price is situated in the lower-middle part of this range.

Most notably, investors are increasingly betting on a rise as prices fall.

Today, one set of market data caught my attention; I believe it is more significant than the index's 43-point decline.

Hang Seng Index:

– Open interest in call warrants rose for the third consecutive session, gaining another 9.15% in a single day.

– Open interest in bull contracts rose for the third consecutive session, up 6.57% for the day.

– Open interest in put warrants fell for the third consecutive session.

– Open interest in bear contracts fell for the second consecutive session.

This means that as the market declines, investors are increasingly inclined to add long positions.

This is not necessarily wrong.

Because if the 25,000 level holds, we are indeed getting closer to support, and the risk-reward ratio for betting on a rebound will start to improve.

But on the other hand, we must also acknowledge:

The more people waiting for a rebound at the same level, the more concentrated the risk becomes if that level breaks down.

Therefore, when choosing bull contracts now, I won't just look at the one with the highest leverage.

I would instead categorize them into three types:

– Near-call-price Bull Contracts: Suitable only for very short-term trading, and you must be prepared to exit immediately if the 25,000 level is breached.

– Medium-distance Bull Contracts: Sacrifice a small amount of leverage in exchange for more room to accommodate normal volatility.

– Long-distance Bull Contracts: If you are betting on a medium-term rebound in the Hang Seng Index rather than speculating on a several-hundred-point rise the next day, a margin of safety becomes even more important.

The same applies to Bear Contracts.

Chasing Bear Contracts with call prices too close to the current market level poses a major risk: since the Hang Seng Index has already fallen for three days, a technical rebound could easily trigger a mandatory call event and wipe you out.

Therefore, today's conclusion is not about 'whether to buy Bull or Bear Contracts.'

But rather:

25,288 is just the first hurdle. What will truly influence the next market move is whether the heavy concentration of bull contracts in the 25,000–25,199 range can hold.

As long as this level remains undecided, neither bulls nor bears should push their leverage to the limit.

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