CHI50 stock index is currently building its biggest green candle of the year in the four-hour chart and in the daily timeframe as well, reversing losses which led the price to a one-month low of 10,689 on Thursday. The technical picture though supports that the price might lack direction in the short term as the RSI approaches its 50 neutral threshold and the MACD flirts with its red signal line.
However, if bullish pressures dominate, the index could run up to test the latest peak at 11,214. Surpassing that level, a stronger wall could be met around 11,414 which bulls were unable to overcome on October 10 and September 19-20. Note that the mark is also comfortably above the Ichimoku cloud, which could increase speculation that further gains might follow up should the price break that point. In this case, eyes will turn towards the support-turned-resistance handle of 11,542.
On the flip side, a pullback is likely to stall around 10,913 which was a significant support in September. Lower than that, another obstacle is likely to be detected near 10,787, while if this fails to halt downside corrections too, attention would immediately shift to the 10,689 bottom. Traders would be also curious to see whether the bears are able to pierce the more-than-a-year low of 10,624.
