Hang Seng Index has finally reversed in 2024!!

Recently, the Hong Kong stock market has been doing well.

It has shown even more bullish signs.

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There are a couple of reasons why an inverted head and shoulders pattern lasting for a longer duration, like 5 months, could indicate a more significant subsequent price movement:

Exhaustion of Sellers: A prolonged downtrend followed by a slow climb out of it suggests sellers might be getting exhausted. The multiple tests of the support level (left shoulder) and the inability to push the price lower signifies a potential shift in sentiment.

Stronger Buying Pressure: The extended formation allows for more prominent rallies (left and right shoulders) compared to a shorter pattern. This could be interpreted as more time and effort during the accumulation process, hinting at a stronger potential upside move when the price breaks above the neckline.