Time for STI to take a break from climbing

There are clear signs of fatigue from the market as we have climbed almost constantly for before the short week came. This can also be explained by dividend hunters and funds starting to leave counters that had already cut dividends. At the moment the market would be way more inclined for a minor reset so that traders can buy back and for late sellers to have a go at taking profits. Therefore, do expect some downside in the coming week and let us see the charts for potential support points.

STI – Updated Daily Chart

On the daily chart, we have 2 immediate resistance turned support lines and they are 3240 and 3200 (psychological). These obvious support lines are not exactly strong but if they do provide some support, then we can expect the market to still be relatively optimistic.

STI – Updated Weekly Chart

This version of my weekly chart hardly comes out because the support and resistance lines are based on the extreme highs and lows on the charts but since we are at an extreme at the moment, we can refer to this version and take note that the next strong support is at around 3160.

Author’s Call as of 13th August 2022

• STI fail to advance in the last week as we are in overbought as we have climbed almost consistently for 2 weeks prior
• Funds have been rotating around dividend counters like banks and REITs and are starting to take profit along with short term sellers
• The daily and weekly charts are pointing towards the 3180 to 3240 range
• Start positioning ourselves for buying opportunities but do not rush back into the market to get better deals.

Author’s Call as of 6th August 2022

• The new issue caused by the China-Taiwan-US conflict has distracted the market from real economic problems
• The 4-day rally in the STI has been surprising unless the Singapore market is seen as a clear safe haven with the help of our well-regulated banks
• The monthly chart suggests a potential pushback in the coming week or two as sellers might turn aggressive in view of the main trend support line
• We continue to notice that fund flows are coming back to the Singapore market therefore, we can start selling at a controlled rate