Asian stocks trade broadly lower today as led by steep fall in the Hong Kong HSI. The index gapped lower as the five-month long protests extended from the weekend into Monday morning, in a number of districts including the CBD. The anti-police sentiments intensified last Friday after the death of a 22-year old university student, which is seen as the first proven fatality directly linked to police action. The situation worsened further today, before office hours, after an unarmed young man was shot by police with live ammo. The 21-year old remains in critical condition.
The gap down today and subsequent steep fall suggests that HSI’s corrective rise from 24899.93 has completed with three waves up to 27894.45. Immediate focus is now on 55 day EMA (now at 26806.62). Sustained break should send the index for retesting 24899.93 low.
The bearish development is supported by rejection from 55 week EMA too. Break of 24899.93 low will extend the down trend form 33530.66 through 61.8% retracement of 18278.80 to 33530.66 at 24105.01.
