The Hang Seng remains in freefall, Alibaba below 100
There seems to be little reprieve for investors in China with the Hang Seng falling to a post-pandemic low and Alibaba trading below 100.
Share this:
Equity investors have been attacked on multiple fronts
Global equity markets have suffered these past two weeks since Russia invaded Ukraine. But it should be remembered that these markets were already under pressure ahead of the invasion. There had been a build-up of tensions this year, as Russia had actually began rallying their troops back in November. Investors also had to contend with the prospects of the Fed’s tightening cycle, which then prompts either central banks to follow suit. Yet rising oil prices has rekindled fears of stagflation, which is negative for equity markets.
Hang Seng falls to a five-year low
And if we hone in-on Asia, investors also had the regulatory crackdown to contend with, which shows no signs of abating. For example, Beijing have since proposed a further tightening of the regulatory screws on the gaming industry, which has weighed on Tencent and NetEase, and of course the broader market. And as for Hong Kong, resident are living in fear of a mainland-China lockdown potentially on the horizon, and that can be clearly seen on the Hang Seng (HSI) which has fallen to a 5-year low.
We can see on the daily chart that the Hang Seng is effectively in freefall, and close -19% lower form its year-to-date high. It has since fallen below the March 2020 low which is significant, as it marks the height of the pandemic when central banks flooded financial markets with easy money. So the fact it has broken that milestone level is very telling, and the market now appears set to test 20,000 whilst prices remain below 21,328.
Alibaba’s bearish target remains in play
We highlighted Alibaba’s head and shoulders top pattern in February, and it remains very much in play. Their Q4 revenue was a disappointment which saw the market gap below the neckline and is now trading below $100. We can see that it has gapped higher on the HKEX exchange as appetite for risk is making a return. But with a multi-month downtrend and break of key support (108 – 110) last month, our downside target around $83 remains in focus. From here we would like to see bearish reversal patterns below 108 to allows for fresh shorts. And the bearish bias is invalidated with a break above $111.
How to trade with City Index
You can easily trade with City Index by using these four easy steps:
- Open an account, or log in if you’re already a customer
• Open an account in the UK
• Open an account in Australia
• Open an account in Singapore
- Search for the company you want to trade in our award-winning platform
- Choose your position and size, and your stop and limit levels
- Place the trade
How to trade with FOREX.com
Follow these easy steps to start trading with FOREX.com today:
- Open a Forex.com account, or log in if you’re already a customer.
- Search for the pair you want to trade in our award-winning platform.
- Choose your position and size, and your stop and limit levels.
- Place the trade.
Related tags:
Latest market news
Open an account in minutes
Experience award-winning platforms with fast and secure execution, and enjoy tight spreads from 0.5 pts on FX and 0.3 pts on indices.
Economic calendar
Web Trader platform
Our sophisticated web-based platform is packed with features.
Related articles
Australian Dollar Forecast: AUD/USD Four-Week Slide Nears Critical Uptrend Support 9 29 2026
Aussie momentum has deteriorated sharply into quarter-end, with inflation, Core PCE and NFP on tap as AUD/USD closes in on a pivotal technical threshold.
Canadian Dollar Technical Outlook: USD/CAD Seven-Day Rally Tests Major Resistance 9 29 2026
USD/CAD is pressing into a major technical barrier after an extended advance, raising the risk for price inflection as momentum stretches.
RBA delivers 25bp hike, Bullock now the main event
The RBA delivered the expected 25bp hike, but Bullock’s press conference now looms as the bigger volatility risk for AUD/USD and the ASX 200.
This report is intended for general circulation only. It should not be construed as a recommendation, or an offer (or solicitation of an offer) to buy or sell any financial products. The information provided does not take into account your specific investment objectives, financial situation or particular needs. Before you act on any recommendation that may be contained in this report, independent advice ought to be sought from a financial adviser regarding the suitability of the investment product, taking into account your specific investment objectives, financial situation or particular needs.
StoneX Financial Pte. Ltd., may distribute reports produced by its respective foreign entities or affiliates within the StoneX group of companies or third parties pursuant to an arrangement under Regulation 32C of the Financial Advisers Regulations. Where the report is distributed to a person in Singapore who is not an accredited investor, expert investor or an institutional investor (as defined in the Securities Futures Act), StoneX Financial Pte. Ltd. accepts legal responsibility to such persons for the contents of the report only to the extent required by law. Singapore recipients should contact StoneX Financial Pte. Ltd. at 6826 9988 for matters arising from, or in connection with the report.
In the case of all other recipients of this report, to the extent permitted by applicable laws and regulations neither StoneX Financial Pte. Ltd. nor its associated companies will be responsible or liable for any loss or damage incurred arising out of, or in connection with, any use of the information contained in this report and all such liability is hereby expressly disclaimed. No representation or warranty is made, express or implied, that the content of this report is complete or accurate.
StoneX Financial Pte. Ltd. is not under any obligation to update this report.
Trading CFDs carries a high level of risk that may not be suitable for some investors. Consider your investment objectives, level of experience, financial resources, risk appetite and other relevant circumstances carefully. The possibility exists that you could lose some or all of your investments, including your initial deposits. If in doubt, please seek independent expert advice. Visit www.forex.com/en-sg/terms-and-policies for the complete Risk Disclosure Statement.