Although UOBKH is up 10% y-o-y, long-term indicators are pointing to a longer-term upclimb. Short-term indicators are high, but that is because these indicators are the equivalent of the first bounce of a ball after it hits the ground.
It’s a “throw-up” move. A consolidation may be overdue but it may not materialise since initial announcements following the market review are likely to be better than expected.
The successful break out above $1.65 indicates a target of $2.10. Support should be raised to $1.70.
See also: STI may retreat on strong overbought pressures but REIT Index may break out
Elsewhere, the Hang Seng Tech Index has risen to its highest level in more than three years. However, at 5,859 it is still significantly below its 2021 high of more than 10,900.
The Lion-OCBC Securities HSTECH ETF (HSTECH) is at a three-year high. Prices consolidated briefly forming a bull flag. Prices have since burst out of the bull flag and continues to rise. As prices rise higher, the risk of a sharp retreat is likely to increase.
The other Chinese ETF on the SGX is Lion-OCBC Securities China Leaders ETF. This ETF replicates the movement of the 80 Stock Connect stocks.
See also: Can the STI hold above 4,000?
China Leaders ETF has just broken out of the thrice-tested $1.78 level indicating an upside of $1.95. Short-term indicators are at the high end of their range.
Nonetheless, with the breakout, China Leaders ETF has the momentum to move higher over the next few weeks.
