Hang Seng with a very technical, bullish reversal

By Tomasz Wisniewski|

Published: December 09 2022, 14:13 GMT+0

Hang Seng with a very technical, bullish reversal


A lot is happening on indices from China, which are currently in a very positive mood after easing of Covid restrictions and coming back to “normality”. In this piece, we will focus on Hang Seng, an index from Hong Kong, for the past few days is the strongest in the world and is currently flashing with a new buy signal.

Reversal on Hang Seng started in November when the price managed to create a very handsome inverse head and shoulders pattern (green). On the last trading day of November, buyers managed to break the neckline of this formation (lower orange), which triggered the buy signal and officially started a mid-term bullish wave. The next important step is happening today as the price is breaking the long-term down trendline, which was connecting lower highs since June 2021. That clears all important resistances for now and sets the target on the yellow area, so highs from April and June 2022.

As long as the price stays above the orange support, sentiment is positive. Price dropping below would be a major sell signal but chances for that are now limited.