The Hang Seng Index declined 446 points to close at 24562 on Friday (17th) after rising for four consecutive days at the week's start, despite opening 18 points higher and reaching an intraday peak of 25166 points before falling as much as 676 points to 24332. For the week, the index still gained 387 points or 1.6%. The decline represented a technical adjustment after the index recovered from its June 26 low of 22518 points, having risen as much as 2703 points to Thursday's 25221 day high, essentially meeting the average monthly volatility range of approximately 2000 points under normal market conditions. The index had rebounded from a more-than-one-year low and crossed multiple technical moving averages in recent sessions.
HSI Records 446-Point Decline After Four-Day Rally
The Hang Seng Index opened 18 points higher on Friday (17th) and briefly touched 25166 points before reversing course. The index fell as much as 676 points to 24332 before stabilizing and rebounding to close at 24562, representing a decline of 446 points for the day. The index lost the 50-day moving average it had just recaptured the previous day, but managed to close closely aligned with the 5-day moving average positioned at 24561 points.
From the June 26 low of 22518 points, the index had rallied to Thursday's day high of 25221 points, marking a maximum recovery of 2703 points. Calculated from the June 30 day low of 22685 points, the movement had essentially satisfied the average monthly volatility range of approximately 2000 points under normal market conditions. The Friday decline of over 1.7% was characterized as a normal technical adjustment.
Weak Stock Index Falls to 20% From July 2 Peak
The EJFQ system's weak stock index, which reflects selling pressure on weak stocks, peaked at 56.5% on July 2 and continued to decline thereafter. After falling below the 40% threshold on July 8, the indicator continued dropping until Friday (17th) when it rebounded 0.8 percentage points to 20%. The selling pressure had decreased for half a month before this slight uptick.
Northbound capital recorded a net outflow of approximately 1.46 billion HKD on Friday (17th). The index had been running above the top of the EJFQ TrendWatch descending channel calculated with one standard deviation for three consecutive days. The channel's central axis rose from 23080 points to 23400 points on a weekly basis.
HSI Recovers 62.4% of Decline From May Peak
The TrendWatch descending channel began on May 14, when the Hang Seng Index peaked at 26844 points. The index subsequently fell a maximum of 4326 points to the June 26 level of 22518 before beginning its rebound. By July 16's day high of 25221 points, the index had recovered 62.4% of its decline, surpassing the 61.8% golden ratio.
Following the bottom on June 26, the index crossed the 5-day, 10-day, and 20-day moving averages in sequence within just seven trading days. The weak stock index coincidentally fell below 40% during this period.
Michael Burry Suggests Hong Kong Stocks Present Bargain Opportunity
Michael Burry, the legendary hedge fund manager whose story was depicted in the film "The Big Short," posted on the X social media platform on Friday (17th) stating: "It is a particularly good time to look to Hong Kong for cheap stocks."
FAQ
What happened to the Hang Seng Index on Friday (17th)?
The Hang Seng Index declined 446 points to close at 24562 on Friday (17th) after opening 18 points higher. The index reached an intraday peak of 25166 points before falling as much as 676 points to 24332, then rebounding to the closing level. Despite the daily decline, the index still gained 387 points or 1.6% for the week.
How much has the Hang Seng Index recovered from its June low?
From the June 26 low of 22518 points to July 16's day high of 25221 points, the Hang Seng Index recovered 62.4% of its decline from the May 14 peak of 26844 points. This recovery exceeded the 61.8% golden ratio. The index had fallen a maximum of 4326 points from the May peak to the June low before beginning its rebound.
What did Michael Burry say about Hong Kong stocks?
Michael Burry posted on the X social media platform on Friday (17th) stating: "It is a particularly good time to look to Hong Kong for cheap stocks." Burry is a legendary hedge fund manager known for his role depicted in the film "The Big Short."
