Straits Times Index Ltd – Daily timeframe (Update from 11 July 2018)
*Entry Price: 3238 Stop loss: 3355 Take profit: 3190
Current Sentiment: Bearish
Support 1: 3200 Resistance 1: 3341
Support 2: 3189 Resistance 2: 3469
The Straits Times Index (STI) rebounded higher as expected after the last update but the bullish momentum was halted at a key resistance area recently. After testing the 3,341 support turned resistance area and 60 day moving average on multiple occasions in July and August, the bears won the tug-of-war and succeeded in capping the upside move. The 3,341 area is also particularly important because it was a key support area that kept the long-term uptrend intact in November 2017, February and April 2018 shown by the highlighted boxes.
With the bearish rejection off the 3,341 resistance area and 60 day moving average since 07/08/18, price has broken below the immediate pullback line and 20 day moving average once again on 13/08/18 suggests the immediate trend has turned bearish.
Expect the STI to head lower next to retest the 3200 – 3189 key support area next. Monitor closely once the STI gets close to that support area to see if the long-term uptrend remains intact or not. The 3200- 3189 support area will be the dividing line to determine if the long-term uptrend remains intact or not.
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