Singapore: STI Index (.STI) business sentiment edged up slightly

Singapore: STI Index (.STI) business sentiment edged up slightly

Singapore: STI Index (.STI) business sentiment edged up slightly

Business sentiment among Singapore firms edged up slightly for the first time after three consecutive quarters of decline, according to the latest Business Optimism Index by the Singapore Commercial Credit Bureau (SCCB).

The index was +6.91 percentage points in Q3 2019, up from +5.08 percentage points in Q2. However, the index lost ground versus its +10.58 percentage points figure in 2018’s third quarter.

The figures were derived from polling 200 business owners and senior executives representing major industry sectors across Singapore, and are calculated by subtracting the percentage of respondents expecting decreases from the percentage expecting increases.

Five of six indicators used by the index – sales, profits, employment, new orders and inventories – increased.

Shayne Heffernan, CEO and Founder of Heffx, said that the bureau was cautious for the next quarter despite the slight sentiment rebound due to mounting downside economic risks from the ongoing US-China trade tensions, and an uncertain global growth outlook.

Mr. Heffernan expects a lukewarm Singapore manufacturing sector in the third quarter, with market maturity and global trade issues posing particular challenges for the electronics and precision engineering sectors.

“The services sector will still remain a key pillar of growth for 2019, driven largely by an expansion in the business services, information and communication sub-sectors,” added Mr. Heffernan.

Overall, the bias in prices is: Sideways.

By the way, prices are vulnerable to a correction towards 3,219.66.

The projected upper bound is: 3,254.56.

The projected lower bound is: 3,121.25.

The projected closing price is: 3,187.90.

Candlesticks

A white body occurred (because prices closed higher than they opened).
During the past 10 bars, there have been 7 white candles and 2 black candles for a net of 5 white candles. During the past 50 bars, there have been 33 white candles and 16 black candles for a net of 17 white candles.

A rising window occurred (where the top of the previous shadow is below the bottom of the current shadow). This usually implies a continuation of a bullish trend. There have been 6 rising windows in the last 50 candles–this makes the current rising window even more bullish.

Three white candles occurred in the last three days. Although these candles were not big enough to create three white soldiers, the steady upward pattern is bullish.

Momentum Indicators

Momentum is a general term used to describe the speed at which prices move over a given time period. Generally, changes in momentum tend to lead to changes in prices. This expert shows the current values of four popular momentum indicators.

Stochastic Oscillator

One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 92.8453. This is an overbought reading. However, a signal is not generated until the Oscillator crosses below 80 The last signal was a buy 10 period(s) ago.

Relative Strength Index (RSI)

The RSI shows overbought (above 70) and oversold (below 30) areas. The current value of the RSI is 46.97. This is not a topping or bottoming area. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a buy 4 period(s) ago.

Commodity Channel Index (CCI)

The CCI shows overbought (above 100) and oversold (below -100) areas. The current value of the CCI is 129.This is an overbought reading. However, a signal isn’t generated until the indicator crosses below 100. The last signal was a buy 4 period(s) ago.

MACD

The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a buy 2 period(s) ago.

Rex Takasugi – TD Profile

STRAITS TIMES closed up 21.820 at 3,188.110. Volume was 6% below average (neutral) and Bollinger Bands were 15% narrower than normal.

Open High Low Close Volume___
3,174.8803,199.5303,171.9003,188.110 197,131,296

Technical Outlook
Short Term: Neutral
Intermediate Term: Bearish
Long Term: Bullish

Moving Averages: 10-period 50-period 200-period
Close: 3,149.81 3,263.29 3,177.27
Volatility: 9 13 15
Volume: 197,791,568 209,212,896 212,514,960

Short-term traders should pay closer attention to buy/sell arrows while intermediate/long-term traders should place greater emphasis on the Bullish or Bearish trend reflected in the lower ribbon.

Summary

STRAITS TIMES gapped up today (bullish) on normal volume. Possibility of a Runaway Gap which usually signifies a continuation of the trend. Four types of price gaps exist – Common, Breakaway, Runaway, and Exhaustion. Gaps acts as support/resistance.
STRAITS TIMES is currently 0.3% above its 200-period moving average and is in an downward trend. Volatility is extremely low when compared to the average volatility over the last 10 periods. There is a good possibility that there will be an increase in volatility along with sharp price fluctuations in the near future. Our volume indicators reflect moderate flows of volume out of .STI (mildly bearish). Our trend forecasting oscillators are currently bearish on .STI and have had this outlook for the last 20 periods.

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