Chart of the day: Capped again
On good volume, futures contracts on the H-share index slumped on Friday, in line with global markets, which were surprised by the result of the British referendum on the European Union. The choice to leave and how the EU will react are seen as just another of the many storm clouds that have been gathering for months over the outlook for the world economy. We now have three descending highs, suggesting the next move will be a drop below 8,150 points – the horizontal support for the right-angled triangle. The 7,835-point level might hold on a first attempt, but then we would target a retest of February’s low at 7,420, something some European indices have already done.
Nicole Elliott is a technical analyst