(MENAFN- Daily Forex) Hong Kong has been a little bit of its own animal as of late, while it has been rallying, the rest of the world has been struggling, perhaps except for the Nifty 50 in India. At this point, we are getting relatively close to the 200-Day ema , which sits just below the HK$20,000 level. Because of this, I think it's going to be very interesting to see how this plays out, as this was a general vicinity of previous support, and a bit of“market memory” could come pictures. The shooting star from the Monday session of course looked very negative, but Tuesday was relatively positive, although we could not break above the top of it.
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It is because of this that I do think it is time for a bit of a pullback, so we can break down below the bottom of the Monday candlestick , I suspect that the Hang Seng could find itself looking at the HK$18,300 level, possibly even the 18,000 level. Underneath there, we have the 50-Day EMA try to catch up and I believe that would be a bit of dynamic support. Speaking of the 50-Day EMA, we are currently between that and the 200-Day EMA, which typically means we are about to see a move in one direction or the other. Clearly, it has been very bullish as of late but will have to wait and see how this plays out.Waiting for a Pullback
Part of what we have been seeing is people trying to get ahead of the Chinese reopening after the lockdowns have relaxed a bit. However, those lockdowns seem to be a bit of a lingering question, and it is probably worth noting that Hang Seng is simply used as a proxy for most of those parts of the Chinese economy anyway. This is simply foreigners deciding whether they are going to put money into the market.
Ultimately, if we can break above the HK$20,000 level, then I do believe that the Hang Seng can continue to be much higher, perhaps reaching the HK$22,000 level. Having said that, I do think that it is going to be a big fight, and it's probably going to take quite a bit of effort to make that happen. With that in mind, I'm looking for the market to pull back and perhaps offer a short-term selling opportunity.
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