INVESTMENT DAILY

The Hang Seng Index is expected to trade at 22,700 to 23,100today

    The sharp decline of US stock, as well as Occupy Central condition intensified,Hong Kong stocks opened 335 points lower on Friday, dropped below the 250DMA(23177), finished the day 446 points lower to 23,089. H-share index fell 182 pointsto 10,301. Market turnover was HK$67.1bn. China Resources Power (836) andLenovo (992) plunged 6.3% and 5.1% respectively.

    US stock market continued its weakness last Friday. Selling pressure emerged onhigh premium technology and new energy sector. The Dow and the Nasdaq closedthe day 115 points (to 16,544) and 102 points (to 4,276) lower respectively. In fact,Nasdaq has fallen below its 200 Day SMA while major index also suffered theirdeepest weekly drop in more than 2 years. Looking ahead, investors will continue toeye on the US economic data and corporate results to be released this week.

    Hong Kong stock market rebounded to 23,000 earlier last week. However, its turnedweak again given uncertainty arose on occupying Central as well as volatile globalstock market. Together market news saying that Shanghai HK Connect might delay,we suggest investors to be cautious.

    Technical Analysis

    Hang Seng Index gap opened lower and closed with black candle on last Friday,Technically, index dropped below 250DMA (23,117), coupled with the MACDbearish gap expanded, showing that momentum turning weak. Hang Seng index firstsupport would be 23,000, while next support would be seen at early October’s low of22,556. For resistance, 10DMA (23,330) become the first resistance, while nextresistance would be seen at 20DMA (23,781)