Hong Kong stocks have recently come under pressure, with the proportion of bull certificates soaring to 77%, warning of risks

Recently, the Hong Kong stock market has been weak, with the decline in the U.S. stock market directly dragging down the Hong Kong market. According to Ming Pao, in the distribution of bullish and bearish warrants, bullish warrants account for as much as 77%, and this extreme structural divergence has attracted significant attention from market participants. Investors face an important question: when market sentiment reverses, will there be a large-scale “kill the bulls” phenomenon, where short sellers suppress long positions.

Weak U.S. stocks become the main reason for Hong Kong stocks’ decline

This week, Hong Kong stocks were significantly affected by international stock market fluctuations. The pullback in U.S. stocks directly impacted Hong Kong stocks, causing a clear downward breakout recently. This correlation reflects a decline in global market risk appetite. Hong Kong investors need to closely monitor the subsequent performance of U.S. stocks, as this will directly determine the short-term direction of Hong Kong stocks.

Imbalance in bullish warrant ratio signals risk

Data from the stock derivatives market shows that bullish warrants make up as much as 77% of the entire derivatives market, while bearish warrants are relatively low. This severe imbalance indicates that market participants are generally optimistic about the future, but it also hides potential risks. If market sentiment suddenly turns pessimistic, these highly concentrated long positions could face intense stop-loss and liquidation pressures.

Hang Seng Index technical fluctuations, watch for subsequent changes

Guo Sihzhi, Vice Chairman of the Hong Kong Stock Analysis Association, pointed out that the Hang Seng Index has already fallen below the 20-day and 10-day moving averages, currently in a highly uncertain technical state. This means that technically, Hong Kong stocks lack a clear direction in the short term. However, Guo Sihzhi still believes that the overall market pattern this month shows a trend of falling first and rising later, which provides some hope for a rebound. Investors should remain cautious and closely observe whether Hong Kong stocks can regain key technical levels to judge future movements.