Index futures return to the market pattern

With the sudden increase in external political and economic risks, the index futures fell sharply on Friday. On the same day, the index futures opened 147 points lower, rebounding weakly, showing a unilateral decline in the market. The stock market once fell more than 700 points, fell below the level of 30,800 points, and fell to 30,798 points, although it rebounded slightly before the market close. However, it eventually fell 695 points throughout the day to close at 30,840, while the market turnover fell again to about 100 billion yuan.

Focus on the US-North Korea summit

With the sudden deterioration of the external atmosphere, the Hong Kong stocks dragged down on Friday. First, before the G7 summit was held on Friday, the United States and other allies (such as Canada and France) had disputes on trade issues. For a time, the G7 seemed to become a confrontation between the U.S. and the G6, making the market global. The worries of the trade war heated up; in addition, emerging market stock exchanges reappeared to fluctuate, and this time the protagonist turned to Brazil, which caused the market to start worrying whether the wave of capital investment will spread from the South American market to emerging markets in Asia, such as India. The country, while the United States and the United States is still hovering in the high, is expected to further increase, may increase the withdrawal of funds from emerging markets, thus affecting the risk appetite of global investors.

In addition, there was also news last week that Tencent (00700) may become the next target to be investigated by the United States, causing the stock to fall by 3.3% on a single day last Friday. As a result, the trend of Hong Kong stocks even worsened; Dragging on Tencent, it has not brought any major and direct impact on Hong Kong stocks yet, so it rebounded by 210 points and regained the 31,000 mark during the closing hours on Friday night. However, it is expected that the news will still bring about a certain degree of investment sentiment. Impact. This week there will be a number of important news worthy of everyone’s attention, such as the US-North Korea summit and the United States, such as interest rates, if no accident, Hong Kong stocks will remain in the short-term pattern of sharply falling, so we should not be too aggressive for the time being.

On the technical front, as stated in the previous period, after the index index broke through the resistance at the top of the large triangle and the previous high of 31,475 points last Thursday, it should have the conditions to move up and point directly at the target of 32005, but it was last Friday. There was a trend of a sharp drop of nearly 700 points, which caused the index to revert back to the large triangle. This may reflect this is only a false breakthrough. The index should fall within the triangle within a short period of time, and wait for the next breakthrough. Opportunity; In addition, the index rose to the top of the Bollinger Band on Thursday, but it returned to the Bollinger Band’s central axis (ie, the 20-day moving average of 30852) within a day on Friday. If the index falls below this support in the next few days, the index may return to the bottom left or right position, which is near the 30,000 level. With the current trend, I expect the index futures to have a weak rebound after a sharp fall, and then the chance for further downside will be higher.

In terms of strategy, all previously held Long Call positions should have been closed on Friday. The forecast period is that the short-term positions will continue to fall in the interval, plus several important international events will occur this week. We should adopt a conservative attitude to the market. It is recommended that you wait until 30,100 to 30,200 points before deploying Long Call, which is 600 to 800 points outside the monthly price. Conversely, if the index rebounds to around 31,400 to 3,150 points, We can also consider the deployment of Long Put, which is 600 to 800 points outside the monthly price.