Direction of the STI

Above is a weekly chart of the STI. I think it gives a much better picture of the trend of the STI. We can see that after the great volatility in 2011, the STI has been much more subdued, trading well within the high and low of 2011. I thought we were in for a serious down move after the STI broke a key pivot at 2977 (which also happens to be below psychological level of 3,000 points), but the STI managed to claw back to close above 3000 points so far this week. And despite a weak Europe opening as i write this, the STI sill managed to close at the day's high. Key resistance is around the 3020 level, while 3000 points looks like pretty good support. On the weekly chart, we can see that we have just broken out of the series of lower highs and lower lows over the past 8 weeks. If we can maintain this gain, chances are, we will have a good December.

a look at the STI

Above is an end of day daily chart of the STI. I thought that the STI would come crashing to 2903 after it broke 2976, but surprisingly, 2953 proved to be a rather good support. The STI did close below that for about 3 days, but after holding steady for 2 more days, proceeded to spring up to close to 3000 points. We have closed above 2976 for 2 days, which is a good sign, but now we see it struggling to hit 3000. So what is the big picture? China and US are starting to pickup. I am not too sure about Japan, but its stock market has been rallying hard, so perhaps it also is expected to pickup. EU is in a very bad shape. The bitter medicine that Germany is forcing Greece and Spain to take is obviously not working. Austerity alone is not going to help a dying economy. Let us hope that wisdom will prevail amongst the EU leaders. For the STI, the trend has turned down since it made a lower low 7 days ago. We are now bouncing up towards resistance at around 3020 where it may resume its downtrend.

critical juncture for the STI

Oh, oh. The STI is at a very critical juncture. It has broken down from the 144-day moving average and is right at the previous low of 2977. If this level fails to hold, then we are looking at a retracement to around 2900.

a look at the STI and some selected stocks

With the uncertainty over the US elections over, the market refocused on the many problems facing the world economy. For the local market, we are seeing another correction to the major uptrend started in Jun this year. The previous correction was in August when the STI hit the then year high of 3087 before hitting a low of 2977, a drop of 110 points over slightly less than a month. We hit a new 2012 high of 3111 in Oct and today's low was 2994 - a drop of 117 points over about 5 weeks. Based on today's price action (it bounced off the longer term moving average), and the generally oversold condition, it is likely that we will see a bounce up to the 3030 region. For now, the shorter and medium term trends are down, with minor relieve rallies. Key support number is 2977. If the STI breaks below that, we are in for a major trend reversal just like what happened in May this year.

Noble group dropped almost 8% to close at $1.175 after releasing results that disappointed analysts. We are now back to testing its previous major support at 1.165. A break below 1.165 would mean a possible retracement all the way to 1.02. Conversely, a break above 1.215 may see it attempt to close the gap at 1.265.

Plenty of selling pressure at genting. Results to be released next week. It has been sold down to previous support levels at 1.235 so there is a good chance of a bounce up to 1.31. But have to wait for 1.235 to hold first.

Another stock retracing all the way back to the previous low of 0.59. But there appears to be some support at about 0.605, and the MACD is exhibiting signs of a bullish divergence. If we are able to close above 0.625, there is a good chance of a reversal to the upside.

a look at STI and some stocks

Here is an end of day daily chart of the STI. The STI broke 3020 support during the day before climbing back to close within the sideways channel. The STI is still very much undecided. In the shorter term, the downside risk is greater as the STI has broken below both the short term and medium term moving averages. A close below 3020 would mean a likely test of 3000 points and 2990 points of the longer term moving average.

shares in Noble group sold off hard today after news broke that the consortium of NOBLE and POSCO walked away from its bid to take over the iron ore and steel producer, ARRIUM. Today's price action is extremely negative and it is sitting right at the previous low of 1.265 and slightly above the 144day moving average. Failure to hold the level around 1.25 could mean a drop to around the 1.22 level.

Golden agri continues to face selling pressure. Today's price action looks like a candlestick hammer - a reversal pattern, but i would like to see a close above 0.62 tomorrow for confirmation of a reversal.

Genting SP has been consolidating since 10 october and it looks like a breakout to the upside today with high volume. There is a good chance of it retesting the previous high of 1.42.

trend of the STI

above is an end-of-day daily chart of the STI. The STI is surprisingly resilient; we have had 2 triple digit losses in the DOW, but each time, after opening down, the STI recovered rather substantially. It was no different today. After opening down, it rallied hard on news that the China PMI data was better than expected, before selling off again on news that the Eurozone's PMI data was worse than expected. We have traded sideways since October, with support at 3020 and resistance at 3063. Support was only tested once, but resistance has been tested three times. It would appear now that support is strong, and that it is only a matter of time before resistance is broken. Momentum is slowly shifting to the upside, as can be seen by the green bars on the MACD. Longer term trend is still up. So it looks like aggressive investors can buy on dips with tight stops, while more conservative ones can wait for the STI to break out of 3063 (as a confirmation of an uptrend) before going long.

Key levels and direction of the STI

Above is an end of day daily chart of the STI. So where is the STI headed? Long term trend is up, but it looks increasingly that it will come down sharply first. Look at the MACD - the momentum has been falling since July 2012 while the price is going up - something called a bearish divergence. I believe this is the result of money being pumped into the economy without any real increase in company's profits/earning. Resistance is now at about 3066. Some support at 3020, but if that is broken, next support is at about 3000. Strong resistance is at 3088.

key levels for STI, noble group and Genting SP

Daily chart of STI. Uptrend is still being maintained, but momentum is still dropping. This is a sign of a big move coming; not sure if it will be up or down. STI opened strongly, but sold off in the afternoon to close only 3 points above yesterday's close. We are still unable to close the gap. Support is at 3020, near term resistance is at 3063, then 3088.

Noble group is breaking out of support at 1.27 and is hitting resistance at 1.335. The trend is up, and I expect it to test 1.38 soon. Strong support is at 1.27.

Genting SP looks to have found support at 1.31. Overall trend is still down, but momentum is rising. Resistances are at 1.36 and then 1.45.

key levels of STI, noble group and capitaland

Above is a daily chart of the STI. The technical picture is mixed. The trend, as indicated by the moving averages, is up. However, the momentum, as indicated by the MACD, is reducing, and a sign of this is that the price action is getting quite choppy. The STI made a new high only two days ago, but profit taking has quickly set in and the upward momentum could not be sustained. Key levels to watch for are support at 3034 and resistance at 3114. There is negative divergence between the STI and its MACD, and this is normally indicative of near term price weakness.

Above is a daily chart of NOBLE GROUP. The trend changed from down to up in Mid july 2012. It appears to be consolidating now for another push higher. Support is about 1.27, but there are quite a few resistance levels. They are at 1.32, 1.34 and finally 1.38.

above ia a daily chart of Capitaland. It doesn't seem to have clear support and resistance levels, but the general direction of the trend is a pretty strong uptrend. Momentum is also declining, but there seems to be pretty good support at about 3.15. Resistance is about 3.30.

key levels for STI, noble group and golden agri

We are now 12 days into a sideways market, which has retraced about 50% to 3040, before rebounding strongly and settling above 3051 over the past 3 sessions. Longer term trend is still up. Key support is at 3040, key resistance is at 3088.

Noble group's price pattern is similar to the STI, but stronger. It has been drifting lower since the huge gap up from 1.28 to 1.31. That gap remains unfilled and is acting as a strong support. Key resistance is 1.38.

Golden Agri has been a huge disappointment after it released convertible bonds. The trend has been down since then. Support is now at 0.63, with resistance at 0.675.

Caution reigns

i have not commented on the STI or the market for quite a few days because the market is not doing anything interesting. After 8 days of listless sideways motion, the STI gapped down and closed down about 20 points today. The longer term trends are still up, but the momentum is not looking so good. The MACD has been making a series of lower highs while the STI retested the previous high of 3088 and failed to penetrate that level. We could be looking at a retracement to about 3020, which is where the medium term moving average is, or even a test of 2980, which is the previous pivot low. Do be cautious, because the economic situation in EUROPE, and China is still looking rather bleak.

STI still range bound, but showing signs of strength

Above is a daily chart of the STI. Support appears to be established at 2975 three days ago and we are moving towards resistance at 3030. A break above that will mean a retest of the year's high of 3088. Trends are shifting to the upside.

Genting gained massively today on high volume and looks poised to break above the previous high of 1.395. A break above that will most likely lead to a test of 1.45. Support is at 1.33.

is the STI rolling over?

Price action of the STI is not good. It has been slowly rolling over since early August. Today it broke recent low of 3004 and looks headed towards the previous pivot low of 2974. The medium term moving average provided some support today, but i dont think that will hold as the mood is decidedly bearish today. If 2974 does not hold, the next support level is 2940. The short term direction is down, but the current downturn seen from a longer term perspective appears to be a healthy correction back to the 61.8% fibonacci retracement level. My view is that the longer term stock market trend is up.

The pattern of tipping over is also seen in most stocks. Here we have a chart of Noble Group falling to its previous pivot high of 1.165 before closing one bid higher at 1.170. There is some support here from the longer term moving average. Next support is at 1.15. Resistance is about 1.20 (medium term moving average)

STI - support held.

i was quite surprised to see that STI closed pretty strongly today. It did not break yesterday's low, and did not close above yesterday's high either. So based on the daily chart, today's price action was pretty strong. The boundaries now are 3005 and 3032. If the STI opens above and closes above 3032, then the uptrend resumes and we should see another test of 3088. If the STI opens below 3005 and closes below that, then we are likely to head first towards 2974 and if that fails to hold, then down to 2940.

STI - support broken

Support at 3036 was broken this morning when the STI gapped down and it continued to sell off very rapidly during the first hour of trading. After that, it simply drifted sideways. The short term technical picture of the STI is rather bearish. Key levels to note are: 3000 points (psychological support), and around 2974 (previous pivot low). For those of you who are long and buying on pullbacks, do be careful because the market could pull back to about 2940 level if the market does not like what the FED chairman says.

STI - not looking so good

STI is not looking so good. Volatility is down, momentum is down, short term trend is down. Key support level is 3036. Once that fails to hold, we are looking at a correction to 2985. Right now, investors are waiting to see what ECB and the Fed are going to do next. I am afraid that if nothing substantial comes out, we are in for a major sell off.

tipping over? or buying opportunity?

Stock market was a bit more exciting today. The market gapped lower and proceeded to sell off hard. But after one hour of hard selling, buyers came back and pushed the index back to where it opened in the morning. Bargain hunters? Or do they know something we don't. As i write now, Europe is still down. Strong support is at 3041 and resistance is at 3088. But if this support fails, the next strong support will be at about 2990. There is a bearish divergence between the MACD and the index charts, so do trade cautiously.

Golden agri staged a remarkable rebound in the afternoon to close at the day's high at 0.72. The stock has been trading in a downward channel since mid July, but support at the moving averages is rather strong. Momentum is slightly up now. Support is at 0.700 and resistance is at 0.745.

Noble Group's price action is rather bullish now, having broken through all three moving averages. It's retracement over the past 3 days is healthy is looks like a good opportunity to take a long position. A long entry between 1.21 and 1.24 would be ideal, with the initial profit target of 1.29. A stop could be placed at 1.19 since 1.21 is a support level.

Gentng is also doing a bit of a retracement, but the stock is still a bit stuck, with resistance at the middle moving average. Price action is a little bullish and a good long position is at 1.305, with an initial price target of 1.38. Initial stop should be placed at 1.23.

national day correction?

After hitting a 2012 high of 3086, the STI has been weak over the past 2 days. It closed 3052 today. Support looks to be at 3040 and resistance is at 3086. Momentum is slightly down, but trend is still on the upside.

golden agri saw heavy selling today and the share price fell from the open at 0.725 to a low of 0.690 before closing at 0.700. I am not too sure of the reason for the big drop, but is probably due to rising inventory levels of CPO (crude pail oil) and falling demand. I was rather bullish on this stock since early july but I am not so sure now as the technical picture is not so positive. It has already broken what looks like support at 0.705 to me (the meeting of the moving averages), so it is best to see where is the next support before deciding on jumping into this trade. Initial support looks like 0.690, resistance is at 0.74.

Noble group, on the other hand, seems to have found support at 1.05 and is staging a rebound. It has broken through both the short and medium term moving averages and looks set to head towards the longer term moving average. Resistance is at 1.175, support is at 1.05.

STI back to 3050

The STI gapped down at the open, mirroring the weaker closes of the US markets, but soon found its footing later in the afternoon. I am looking for it to go to 3100 soon. Support is at 3016.

Golden Agri also had a weak open and at one point in time was sold down to 0.71. But it rallied in the afternoon to close at 0.725. Resistance is at 0.745.

Capitaland rose strongly today on high volume to close at 3.12. Support is at 3.00. First target is 3.155, second target is 3.20. This stock is outperforming the STI.

Genting rose slightly on high volume. The larger trend of Genting is still down, but momentum is going higher. It seems to have found some support at 1.285. There is some resistance at 1.32, and the next resistance is at 1.41.

STI breaks through 3040

Yes! STI has broken through its previous high of 3040 and i think will head towards 3100 (the 161.6% fibonacci projection). Support looks to be around 3020.

Capitaland has also broken through 3.00, and is headed towards 3.155 (the previous pivot high). Support is about 2.95.

Golden Agri is rather disappointing today. I had expected it to continue going up to 0.78, but it instead fell to 0.72. Support remains at 0.705 and my short term target for this stock is 0.78.

will STI break through this time?

Very volatile day for the STI today. It gapped down at the open, and then slowly powered up to close near major resistance again. I think the STI will break this level very soon.

Golden agri has bounced off nicely at 0.705 and is headed towards 0.780.

Capitaland has broken 3.00 and should be headed towards 3.155. Support is at 2.865.

Noble group fell off support of 1.05 to a low of 1.02. It recovered over the past 4 days to close at 1.075. The is a bullish divergence between the share price and the MACD, so indications are that the price is headed higher. But there are many resistances to overcome, namely the three moving averages. So for now, support is at 1.05, resistance is at 1.10.

Bears win today

The bulls really got killed today. We opened very optimistically today, but again, we got sold down in the afternoon to close just at the 61.8% fibonacci retracement level. The major trends are still up, but momentum is down. It looks ugly, but I think any retracements should be a good buying opportunity. But please buy only the uptrending stocks on retracement. Support for the STI is now down to about 2971, which is also the level of the shorter term moving average. Strong resistance at 3030.

What do i mean when i say buy only uptrending stocks on retracement? Have a look at the chart of Wilmar above. I am showing a weekly chart to give you a better overall view of the major trend. This stock has been trending down since 2010, at a peak of $7.29. It did find some support at $6.00, then about $5.25 and after it broke $4.50, its downtrend suddenly accelerated. I do not know the reason for such weakness in Wilmar's share price, but to me, the only good way to trade wilmar is on the short side. Technically, resistance is around $3.88, but it looks like the stock is headed towards $2.94 (the next Fibonacci retracement level).

Here is a chart of Golden Agri, which is in a similar business to Wilmar, which is processing CPO (crude palm oil) into edible oils. I am only showing a daily chart here, but you can see from the relative position of the prices to the multiple moving averages, and also the recent price action, that it is on an uptrend and has been retracing for the past 5 days. Support is at 0.705, and today's price action looks rather bullish as it closed above yesterday's close. Support is at 0.705, with resistance at 0.78.