HSI Hong Kong's Hang Seng Index Weekly Chart; Bear Market

Hong Kong's HSI slips into a bear market dropping from its top at 33550 to 26613 today, down 6937 points, -20.7%. A correction is a -10% drop off a top and a bear market begins at -20% off a top.

The indicators are positively diverged except for the weak and bleak MACD line that wants another lower low in price after a bounce in this weekly basis. The stochatics are oversold agreeable to a bounce. The falling green wedge is bullish. The RSI did not reach oversold territory. The monthly chart is weak and bleak.

The lower standard deviation band is violated so the middle band at 28950 and dropping is on the table. The possie d will likely bonce the Hang Seng in this weekly time frame say for a week or two like the action that occurred a month ago. However, due to the weak and bleak MACD, price will likely collapse again and come down for a couple weeks of so and print a lower low under the current lows. At that time the MACD line will likely set up with positive divergence. That would be the time, say 3 or 4 weeks out where the bounce that occurs would be more substantive and allow price to head upwards for 2 to 4 weeks to tag that middle band. Perhaps this bounce may be in concert with a US-China trade understanding.

The monthly chart forecasts weakness on the monthly basis so going into the end of the year the Hang Seng will likely fall apart again and trend lower. Hong Kong will likely finish this year and begin 2019 very ugly. A bounce can be played in the near-term but it takes a nimble hand. Once the MACD line positively diverges say in a couple weeks or so that would be a better place to ride a rally higher but you will not want to hold that trade for a long period of time either. This information is for educational and entertainment purposes only. Do not invest based on anything you read or view here. Consult your financial advisor before making any investment decision.