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  • The Hong Kong 50 index has initially tried to rally a bit during the trading session on Wednesday, but gained back gains as we continue to see the market deal with an over bond condition.
  • I think at this point in time we are trying to stabilize around the 18,400 Hong Kong dollar level with the 18,000 Hong Kong dollar level underneath offering a pretty significant floor from what I can see.
  • With this, I think the uptrend is still intact, at least at the moment.

    •   Ultimately, this is a market that I do think traders continue to play to the upside, but I also recognize then it could be somewhat noisy. This is mainly due to the fact that there are a lot of concerns out there about the possibility of a shrinking global economy, and that, of course, has an ugly effect on anything Chinese related. I Like Dips for EntriesSo ultimately, I do like the idea of buying dips, especially with the 50 day EMA sitting right around the 18,000 level. In general, the shooting star that formed for the day does suggest that perhaps a pullback is still in the cards, but I think that pullback just leads to more overall consolidation. The market participants continue to look at the potential of whether or not the economy is going to strengthen or weaken globally. That will have an outsize effect on the Hang Seng 50. If we were to break down below the 18,000 level, then we could see the market test, the 200 day EMA near the 17,700 level, anything underneath there, then I think you’ve got serious problems. The alternate scenario is that we break above the 18,800 level, which opens up a move back to the highs that we had recently made near 19,900. We are in a state of influx. I do favor the upside, but I need to see some follow through before I start buying.More By This Author:USD/CHF Forecast: Looking For SupportGBP/JPY Forecast: GBP Recovers Nicely Against The YenGBP/USD Forecast: Sterling Continues To Pressure Upside

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