Consolidate before making another move (May 10, 2024, half-day)

Preface: The U.S. stock market has risen for six consecutive days, while the Hong Kong stock market consolidated for about a week before gaining momentum again this morning......

Hong Kong Market Update

$Hang Seng Index(00HSI.HK) After consolidating for four trading days, it surged again today with a gap-up opening. This morning, it opened about 100 points higher and briefly attempted to challenge the 18,900-point level but failed. It then retested the opening level before regaining momentum in the latter half of the morning session, approaching 18,900 points again. It closed at 18,792 points at midday, up 254 points. The half-day turnover was HKD 66.3 billion.

Strategy

$Hang Seng Index(00HSI.HK) After a period of consolidation, the likelihood of an upward trend in the near future is high. Once it breaks through the resistance level, the next target won't be 19,000 points but rather the 19,400-19,500 range. This range aligns with the potential upside measured by the head-and-shoulders bottom pattern mentioned by 'M88' last Friday. Last week, it was also predicted: "...the Hong Kong stock market is unlikely to show much movement this week until next week, around the time when $BABA-W(09988.HK)  releases its quarterly earnings, which will bring new developments."

The market has regained vitality, with the best-performing blue-chip stock this morning being $HKEX(00388.HK), which rose by HKD 18, nearly 7%. Additionally, the mainland bank and insurance sectors performed well. In contrast, the tech sector was relatively weak, with $TENCENT(00700.HK) rising less than 1% at midday, while $MEITUAN(03690.HK) even fell. As for $BABA-W(09988.HK), which will report quarterly earnings next week, it performed relatively better than other tech stocks today, rising 1% at midday.

Alibaba's earnings are approaching, and 'M88' is confident about them. However, the market needs more than just confidence—it needs a surprise. To push Alibaba's stock above $90 in the short term, there’s still a missing catalyst. 'M88' believes the quarterly report will provide that catalyst.

Good luck to everyone.

(The above views represent personal opinions only. The investment strategies provided in this article may not be suitable for everyone and should not be considered as an invitation or intention to buy or sell financial products. Securities prices can rise or fall and may even become worthless. Trading securities does not guarantee profits and may result in losses. Investors and clients should exercise caution and consider this as one of many factors when making investment decisions.)