Fifth waves, like fifth columns, typically mean bad news, and Hong Kong's equity market is the middle of one, SocGen-Crosby Securities says. Thomas Schroeder, director of technical research, said the Hang Seng Index would make a run for 16,500 points in the next four weeks before turning sharply lower. 'This is half-way through the fifth wave,' he said. For chartists, that point in a bull market typically indicates a final froth-ridden run culminating in a protracted fall. 'After the handover, people will say: 'Why are we buying red chips now?'.' The downturn would be triggered by the Hong Kong rally reaching the end of its natural chart-revealed lifespan, post-transition weakness and signs that longbond yields were headed higher towards the end of the year. The sell-off could take the index back to 13,000 points, he said. Mr Schroeder's forecast came with one proviso: all bets would be off if the Hang Seng Index failed to breach the 15,000-point level. Although intra-day highs were registered above that point, the blue-chip barometer's record closing high came in at 14,990.9 points on June 2. Mr Schroeder said the short-term target for long-bond yields was 6.55 per cent as the fixed-income market continued to factor in signs that the US economy had slowed and inflation was under control. He forecast that US Treasuries would begin rising by the third or fourth quarter as the world's largest economy started to expand at a faster clip once again.