HK Stock Focus CK Asset Holdings rebounded from key support

Medium-term technical outlook on CK Asset Holdings (HKG: 1113)

Key technical elements

• CK Assets Holdings, formerly Cheung Kong Property Holdings has managed to stage a rebound from its medium-term ascending channel support in place since 29 December 2016 low,
• The key medium-term support rests at 65.30/64.80 which is defined by the lower boundary of the aforementioned ascending channel, the gap support seen on 16 Oct 2017 and 23.6% Fibonacci retracement of the up move from 29 December 2016 low to 09 August 2017 high.
• The daily RSI oscillator has continued to inch higher from its corresponding support at the 40% level and still has potential room to manoeuvre to the upside before it reaches an extreme overbought level of 89% seen on 09 August 2017. These observations suggest that medium-term upside momentum of price action remains intact.
• The next significant medium-term resistances stand at 72.50/74.10 follow by 77.55/78.18 (upper boundary of the aforementioned ascending channel, the swing high area of 03 June 2015 & Fibonacci projection cluster).

Key levels (1 to 3 months)

Pivot (key support): 65.30/64.80

Resistances: 72.50/74.10 & 77.55/78.18

Next support: 58.45/55.70

Conclusion

The recent corrective decline from its 09 August 2017 high of 70.50 has managed to stall at the medium-term ascending channel support in place since 29 December 2016 low coupled with positive elements as per highlighted earlier.

Therefore, as long as the 65.30/64.80 key medium-term pivotal support holds, CK Asset Holdings may start to undergo another round of bullish impulsive upleg to target the next resistances at 72.50/74.10 follow by 77.55/78.18 next.

However, a break below 64.80 shall invalidate the impulsive upleg scenario to open up scope for an extension of the on-going corrective decline towards the key long-term support of 58.45/55.70 (ascending trendline from 28 Jan 2016 low & former swing high areas of 09 Sep/01 Nov 2016).

Chart is from eSignal

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