May 5th
What a day. The HSI opened down 380 points, breaking all the major moving average lines, including the 250 day MA line. Surprisingly, the Shanghai index reversed its drop after lunch and ended up gaining 0.77%. The HSI followed its Shanghai peer, reducing its drop to around 250 points. However, this only lasted for half hour and the index continued to drop and closed at 20328 (down 2.1% – 436 points).
Action for the day
The bull certs bought yesterday were bought at around 20700… Eventually the HSI will go back up, but I just hope that the index will not drop below 19900 – the callable level of my bull certs. If the HSI drops further tomorrow, I may need to roll this bull cert to another one with a lower callable level.
Bought another set of bull cert right before lunch today. I was surprised at the sudden rise in the Shanghai market during lunch so I sold this bull certs shortly after the market reopened after lunch. This is pure luck that the HSI dropped again right after I sold the certs. Lucky me!
It seems like the market will continue to be weak. I guess if Europe and the US stop dropping in today’s trading then the HSI will have some support at this current level tomorrow. Otherwise, I think that it can drop down to 20000 easily.
I wondered why the index suddenly dropped after 3pm, not following through the big jump from the Shanghai market. Is it because they saw Europe was down again at open, and that’s why everyone starts selling again? I haven’t seen Europe played such a big influence on the HK market, but probably this time it is different because it is a Europe crisis.
