The HSIF staged a technical rebound on Monday, climbing 228 pts to close at 17,665 pts.
RHB Retail Research (RHB) said in a note today (July 23) the index began the Monday session at 17,442 pts.
It then rose to the 17,716-pt intraday high before closing at 17,665 pts.
At the time of writing, it was last traded at 17,710 pts during the evening session.
Although the index saw positive price action during the session, it has yet to chart a "higher high".
As it is still trading below both the 20-day and 50-day SMA lines, the bears continue to have the technical advantage.
They observed that both moving average lines are rounding downwards, placing downward pressure on the index.
A resumption of the correction will see the index pull back to retest the 17,000-pt level.
As the technical setup remains bearish, they maintained their negative trading bias.
RHB noted that traders are advised to keep the short positions initiated at the close of 30 May (18,126 pts).
To minimise the trading risks, the stop-loss is placed at 18,500 pts.
The nearest support is marked at 17,000 pts, followed by 16,000 pts.
Meanwhile, the nearest resistance is still pegged at 18,000 pts, followed by 18,500 pts.