Hang Seng Index Was Under Pressure on Bad Economic outlook

Hong Kong's Hang Seng Index fell more than 2% on the increase of jobless rate, the downgrade of credit rating and the decline of U.S. Futures. At the same time, China's Shanghai Composite Index was down around 1%. As the Mainland China stocks weighted more than half in Hang Seng Index, it suggests that Hang Seng Index is relatively under-performed today.

Let's take a look for the recent new. Hong Kong's jobless rate rose to 4.2% in the January-March period (4.0% expected) from 3.7% in the prior period, according to the government. Besides, Hong Kong's credit rating was downgraded to "AA-" from "AA" at Moody's, outlook "Stable". The rating agency stated: "After prolonged social unrest in 2019, Hong Kong's economy is facing a second major shock from the emergence of the COVID-19 pandemic in January. (...) After prolonged social unrest in 2019, Hong Kong's economy is facing a second major shock from the emergence of the COVID-19 pandemic in January."

From a technical point of view, the outlook of Hang Seng Index would be bearish on a 30-minutes chart. Firstly, the prices broke below rising trend line drawn from March low. In addition, the prices have broken the neckline and identified a bearish double top pattern. Therefore, unless today's open price at 24240 is violated, the index would consider a further decline to 38.2% retracement at 23320 and 50% retracement at 22900 in extension.

Source: GainCaptial, Tradingview

The information on this web site is not targeted at the general public of any particular country. It is not intended for distribution to residents in any country where such distribution or use would contravene any local law or regulatory requirement. The information and opinions in this report are for general information use only and are not intended as an offer or solicitation with respect to the purchase or sale of any currency or CFD contract. All opinions and information contained in this report are subject to change without notice. This report has been prepared without regard to the specific investment objectives, financial situation and needs of any particular recipient. Any references to historical price movements or levels is informational based on our analysis and we do not represent or warranty that any such movements or levels are likely to reoccur in the future. While the information contained herein was obtained from sources believed to be reliable, author does not guarantee its accuracy or completeness, nor does author assume any liability for any direct, indirect or consequential loss that may result from the reliance by any person upon any such information or opinions.

Futures, Options on Futures, Foreign Exchange and other leveraged products involves significant risk of loss and is not suitable for all investors. Losses can exceed your deposits. Increasing leverage increases risk. Spot Gold and Silver contracts are not subject to regulation under the U.S. Commodity Exchange Act. Contracts for Difference (CFDs) are not available for US residents. Before deciding to trade forex, commodity futures, or digital assets, you should carefully consider your financial objectives, level of experience and risk appetite. Any opinions, news, research, analyses, prices or other information contained herein is intended as general information about the subject matter covered and is provided with the understanding that we do not provide any investment, legal, or tax advice. You should consult with appropriate counsel or other advisors on all investment, legal, or tax matters. References to FOREX.com or GAIN Capital refer to StoneX Group Inc. and its subsidiaries. Please read Characteristics and Risks of Standardized Options.

Please note that foreign exchange and other leveraged trading involves significant risk of loss. It is not suitable for all investors and you should make sure you understand the risks involved, seeking independent advice if necessary.

The products and services available to you at FOREX.com will depend on your location and on which of its regulated entities holds your account.

FOREX.com is a trading name of GAIN Global Markets Inc. which is authorized and regulated by the Cayman Islands Monetary Authority under the Securities Investment Business Law of the Cayman Islands (as revised) with License number 25033.

FOREX.com may, from time to time, offer payment processing services with respect to card deposits through StoneX Financial Ltd, Moor House First Floor, 120 London Wall, London, EC2Y 5ET.

GAIN Global Markets Inc. has its principal place of business at 30 Independence Blvd, Suite 300 (3rd floor), Warren, NJ 07059, USA., and is a wholly-owned subsidiary of StoneX Group Inc.