Massive intervention by the Fed, the PBOC and the ECB to support the market and prevent a free fall has temporarily stalled the collapse. The key support level for Hong Kong stock market is 8000, as a sustained break below 8000 could trigger a massive derivative selling that could quickly crash the Hang Seng index down to a much lower level, dragging the world market down with it.
As such, the current market may temporarily stall and bounce. How far and how long it is difficult to say, it will depends very much on the price of crude oil.
Key price inflection level for NQ on Friday remains at 4100.
-- Selling pressure will be muted above 4100, with strong resistance at 4200 - 4210. A clear and sustained break above is likely to trigger some short-covering rally.
-- Breaking below 4100 could trigger another round of selling, especially if crude oil price is also in a sell mode.
