Executive Summary

Are you ready to tap into the potential of SGX’s new Hong Kong SDRs? In this article, I dive deep into the technical charts of three powerhouse stocks—Bank of China, HSBC, and Tencent—and reveal the key support and resistance levels every trader should know.

Whether you’re a conservative investor looking to buy on dips or an aggressive trader eyeing breakouts, I’ve got actionable insights to help you navigate these exciting opportunities.

With detailed SGD price conversions and my 1GT (Pro) Indicator signals, this is your ultimate guide to trading these top SDRs like a pro. Don’t miss out—read on to uncover the strategies that could give you an edge in the market!

1) Bank of China Ltd (3988.HK)

Bank of China is one of China’s major state-owned commercial banks, offering a comprehensive range of financial services, including corporate and personal banking, investment banking, insurance, and asset management.

With its extensive presence both domestically and internationally, the bank plays a crucial role in supporting the Chinese economy.

Technically, the stock is currently trading at HKD 3.94 (S$0.71), holding firmly above the immediate support at HKD 3.50 (S$0.63).

The price is supported by the 20-day moving average (green line), which is trending upwards, indicating short-term bullish momentum.

The 100-day moving average (red line) and the 200-day moving average (blue line) are also pointing higher, confirming the longer-term uptrend.

My 1GT (Pro) Indicator has generated a recent bullish signal (green), reinforcing the strength of the ongoing recovery.

This signal is still valid and aligns with the upward momentum observed over the past few weeks.

On the upside, the immediate resistance to monitor is at HKD 4.00 (S$0.72).

A breakout above this level could pave the way for further gains, with the next significant resistance at HKD 4.50 (S$0.81), representing an upside potential of approximately 11.5% from the current price.

On the downside, HKD 3.50 (S$0.63) remains a critical support level, and any break below it could lead to a deeper retracement.

So how does one take a position in Bank of China from the HK SDR traded on the SGX?

Well, you can take a position in this SDR, which is named Bank of CN HK SDR 1to1 (HBND) currently priced at S$0.695.

For traders, a conservative approach would involve accumulating on dips near the immediate support level of HKD 3.50 (S$0.63), where prices are more attractive and risk is lower.

An aggressive approach would be to wait for a breakout above the HKD 4.00 (S$0.72) resistance level, confirming further bullish momentum.

With the recent bullish signal from my 1GT (Pro) Indicator, the stock presents an opportunity for those looking to position themselves ahead of a potential breakout.

A stop loss could be placed slightly below HKD 3.50 (SGD $0.63) to manage downside risk, in case the stock fails to hold above this support.

Note that for Bank of China, the ratio is 1 SDR to 1 underlying stock, so the conversion from HKD to SGD will be to simply multiply by the exchange rate of 0.18.

2) HSBC Holdings (0005.HK)

HSBC Holdings Plc is one of the largest banking and financial services institutions globally, with a strong presence across Asia, Europe, and the Americas.

The bank provides a wide range of financial products and services, including retail and corporate banking, wealth management, and investment banking.

From a technical standpoint, the stock has continued to show strength, with a recent price of HKD 75.45 (S$2.72), hovering above the key support level at HKD 74.00 (S$2.66).

This level, previously acting as resistance, has now turned into a strong support zone, backed by bullish price action.

Additionally, the upwards sloping 20-day moving average (green line) aligns closely with current levels, signaling that the short-term uptrend remains intact.

The 100-day moving average (red line) at and the 200-day moving average (blue line) are both trending upwards, indicating a long-term bullish trend.

The recent bullish signal from my 1GT (Pro) Indicator, marked on the chart, further adds to the positive sentiment, suggesting that the stock has more room to climb.

The next resistance level stands at HKD 76.00 (S$2.74), with a more significant hurdle at HKD 80.00 (S$2.88), where we can see some profit taking again.

A break above this level could see the stock entering a new upward trajectory, providing an attractive upside for traders.

So how does one take a position in HSBC Holdings from the HK SDR traded on the SGX?

Well, you can take a position in this SDR, which is named HSBC HK SDR 5to1 (HSHD) currently priced at S$2.43.

For traders considering an entry, a conservative approach would be to accumulate on dips near the support level of HKD 74.00 (S$2.66), where prices are more attractive, and risk is lower.

A stop loss can be placed slightly below this support, around HKD 73.00 (S$2.63), to manage downside risk if the support fails to hold.

On the other hand, an aggressive approach would involve entering on a breakout above the immediate resistance at HKD 76.00 (S$2.74), signaling continued bullish momentum.

With the current positive technical indicators, HSBC presents an opportunity to capitalize on the ongoing uptrend.

Note that for HSBC Holdings, there is a ratio of 5 SDR to 1 underlying stock, so the conversion from HKD to SGD will be to multiply by the exchange rate of 0.17, then divided by 5.

3) Tencent Holdings (0700.HK)

Tencent Holdings Limited is a leading Chinese multinational technology company known for its gaming, social media, and fintech businesses.

It owns popular platforms like WeChat and QQ and operates a significant cloud computing and digital content ecosystem.

The stock recently traded at HKD 368.40 (S$6.63), currently testing a key support level near HKD 350.00 (S$6.30).

This level coincides with a prior resistance-turned-support zone, making it critical to observe whether it holds.

The 20-day moving average (green line) has started to turn downwards, indicating short-term weakness, while the 100-day (red line) and 200-day (blue line) moving averages remain steady, suggesting a neutral long-term trend.

On the chart, a bearish signal from my 1GT (Pro) Indicator was triggered in early November, marking a potential shift in sentiment.

This bearish signal has played out as prices retraced from the HKD 480.00 (S$8.64) resistance level, which remains a significant hurdle.

A break above this level could reverse the current weakness and reignite bullish momentum, targeting higher highs.

We have seen weakness in the past 2 days on the back of news of Tencent being added to a list of Chinese military companies by the U.S. Department of Defense.

Tencent shares slide in Hong Kong after the company’s U.S. depository receipts fell about 8% overnight.

Tencent called the inclusion a ‘mistake,’ saying they are not a military company or engaged in any military related activities.

So how does one take a position in Tencent Holdings from the HK SDR traded on the SGX?

Well, you can take a position in this SDR, which is named Tencent HK SDR 10to1 (HTCD) currently priced at S$6.51.

For traders looking to enter, a conservative approach would involve accumulating closer to the HKD 350.00 (S$6.30) support level, with a stop loss placed just below this level at approximately HKD 340.00 (S$6.12) to manage downside risk.

This allows entry at potentially more attractive prices if the support holds.

An aggressive approach, however, would be to wait for a rebound and a confirmed breakout above the HKD 400.00 (S$7.20) mark, signaling renewed upward momentum.

With a clear plan for entry and risk management, Tencent presents an opportunity for traders, especially if the price action stabilizes around current support levels or breaks back above resistance zones.

About the Author - Joey Choy

Joey is Singapore’s renowned mentor on how to make an income by trading the stock market, an author and one of the most-watched, quoted and followed stock trading trainers in Singapore. Over the years, he has conducted numerous full house seminars, enriching thousands to trade more profitably. 

Joey’s come back story from a S$740k debt has been featured in the Business Times and inspired thousands in Singapore. In less than 3 years, he is highly regarded as one of the Top Tier Remisiers (Stock Brokers) and Traders, bagging numerous yearly awards like Top Trading Representative and Top CFD Achiever every year from 2014 to 2023 in Phillip Securities.

More about Joey here

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- Joey

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