Geely Automobile (175.HK) Broke Above the Declining Trend Line After the Announcement of Returning to A-Share

Chart showing uptrend
Geely Automobile (175), a vehicle manufacturer, said it has approved a preliminary proposal for the possible issue of RMB Shares and listing on the Science and Technology Innovation Board of the Shanghai Stock Exchange.

Citigroup raised the company's target prices from HK$16.7 to HK$20.0. The bank believed that the Company's A share listing will be accretive to its market capitalization. Currently, Chinese auto A-shares are trading at a 65% premium above Hong Kong's H-Shares.

On the daily chart, the stock jumped 5.8% after the announcement and broke above the declining trend line  drawn from January top. Besides, the 50-period moving average is turning up, indicating that the trend gradually changes to positive.

The bullish readers could set the support level at HK$11.36 (the previous low). A break above HK$13.32 (the high of May) would validate a double bottom pattern and consider a rise to HK$15.4 (the high of February).

Source: GAIN Capital, TradingView
Related tags: China

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