Aluminum prices hit a near four-year high! Chalco (2600) stands firmly above multiple moving averages, with RSI at 52 indicating neutral to slightly strong.

Reviewing the March 12 analysis from [HK Stocks Podcast], analyst Simon provided detailed insights on Chalco. He noted that Chalco closed at HKD 13.96 that day, rising approximately 4.4%. After opening at HKD 13.53, the stock gradually climbed, reaching a high of HKD 14.18 during the session with a turnover of about HKD 1.86 billion. Observing recent trends, after a prior pullback, the stock rebounded again, drawing increased market attention.

From a technical structure standpoint, Simon analyzed that Chalco's share price is nearing the 10-day moving average at HKD 13.99, while still remaining above the 20-day moving average at HKD 13.63 and the 50-day moving average at HKD 13.38. This moving average arrangement typically indicates that the medium- to short-term structure remains stable without clear signs of weakening. However, as the price is currently near the 10-day moving average, its short-term direction still needs further confirmation. In terms of momentum, the 9-day RSI stands at 53.88, within a neutral-to-strong range. The RSI has not reached overheated or oversold levels, indicating balanced market momentum—neither excessive buying nor obvious selling pressure. Therefore, the short-term trend will likely remain range-bound.

Based on technical positioning, Simon identified specific support and resistance levels. The first near-term support is around HKD 13.60, close to the 20-day moving average. If it breaks below this area, the next key support would be near HKD 13.38, corresponding to the 50-day moving average. Should the market correction deepen, attention should be paid to the support strength at the psychological level of HKD 13. On the resistance side, the immediate level is around HKD 14.20, which aligns with the intraday high region. A breakout and stabilization above this area could lead to the next noticeable resistance zone between HKD 15.00 and HKD 15.30, near the one-month high of HKD 15.27. Considering these support and resistance zones, Chalco’s reasonable short-term trading range is approximately between HKD 13.60 and HKD 14.20. Breaking above HKD 14.20 might push the stock towards testing the HKD 15 level, while falling below HKD 13.60 may signal a retreat towards HKD 13.30.

Simon also mentioned that some investors were monitoring both Call and Put warrants. From a structural perspective, the call warrant with a strike price of HKD 16.89 is relatively out-of-the-money, about 20% away from the current price. If the stock merely oscillates within the HKD 13.60–14.20 range in the short term, such products will generally exhibit low sensitivity to price changes. Significant leverage effects will only emerge if the stock rises continuously and approaches the HKD 15 level. As for the put warrant with a strike price of HKD 10.88, it is deeply out-of-the-money relative to the current price. This implies that even if the market experiences a normal correction, such as retreating to around HKD 13, the sensitivity of these products may not be very pronounced. Typically, these deep out-of-the-money puts are more suitable for anticipating a notable mid-term decline.

In summary, Simon noted that Chalco’s technical structure is moderately stable. The stock remains above major moving averages, and the RSI is in a neutral zone. Thus, the short-term outlook can be classified as 'neutral.' Unless it breaks through the resistance at HKD 14.20 or falls below the support at HKD 13.60, the stock will likely continue to trade within a range. For investors watching both Calls and Puts, the market is still in an uncertain phase, so short-term strategies should focus on whether the stock breaks out of or falls back within the technical range. With the latest price at HKD 14.12—between the support at HKD 13.60 and resistance at HKD 14.20—the view aligns with the Podcast analysis: short-term trading should consider range-bound movements, either accumulating on dips or waiting for breakout signals.