Singapore: STI Index (.STI) core inflation likely eased to its slowest pace in nearly three years

Singapore: STI Index (.STI) core inflation likely eased to its slowest pace in nearly three years

Singapore: STI Index (.STI) core inflation likely eased to its slowest pace in nearly three years

Singapore’s core inflation likely eased to its slowest pace in nearly three years in July, reinforcing expectations that the central bank will loosen policy later this year to support the city-state’s subdued economy.

A Reuters poll of 11 economists forecast core inflation of 1.0% in July from a year earlier, versus 1.2% in June. That would mark the gauge’s smallest rate of increase since September 2016.

Core inflation is the Monetary Authority of Singapore’s preferred price gauge for setting monetary policy. It excludes changes in the price of cars and accommodation, which are influenced more by government policies.

Singapore’s headline consumer price index in July likely rose 0.55%, the median of 12 forecasts showed, compared with 0.6% a month earlier.

Singapore has been posting a slew of muted economic growth data. Last week, it slashed its full-year economic growth forecast as global conditions were seen worsening and data confirmed the slowest growth rate in a decade, amid mounting fears of recession in the city-state.

“We think that in October they are going to ease to a neutral bias or zero appreciation of the Sing NEER (Singapore Dollar Nominal Effective Exchange Rate) given the slowing core inflation as well as the GDP growth number,” said Lee Ju Ye, an economist with Maybank Kim Eng.

Technical Indicators

Overall, the bias in prices is: Downwards.

Note: this chart shows extraordinary price action to the downside.

By the way, prices are vulnerable to a correction towards 3,219.16.

The projected upper bound is: 3,183.49.

The projected lower bound is: 3,058.17.

The projected closing price is: 3,120.83.

Candlesticks

A black body occurred (because prices closed lower than they opened).
During the past 10 bars, there have been 6 white candles and 3 black candles for a net of 3 white candles. During the past 50 bars, there have been 30 white candles and 19 black candles for a net of 11 white candles.

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 56.4195. This is not an overbought or oversold reading. The last signal was a buy 7 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 26.04. This is where it usually bottoms. The RSI usually forms tops and bottoms before the underlying security. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a sell 31 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 -75. This is not a topping or bottoming area. The last signal was a buy 3 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 sell 30 period(s) ago.

Rex Takasugi – TD Profile

STRAITS TIMES closed down -13.380 at 3,122.570. Volume was 16% above average (neutral) and Bollinger Bands were 85% wider than normal.

Open     High      Low     Close     Volume___
3,128.6803,130.3003,116.8503,122.570 248,360,208
Technical Outlook 
Short Term: Neutral
Intermediate Term: Bearish
Long Term: Bearish
Moving Averages: 10-period     50-period     200-period
Close: 3,144.50 3,283.34 3,212.79
Volatility: 8 12 13
Volume: 248,710,608 222,412,960 209,787,200

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 is currently 2.8% below its 200-period moving average and is in an downward trend. Volatility is relatively normal as compared to the average volatility over the last 10 periods. 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 15 periods. Our momentum oscillator is currently indicating that .STI is currently in an oversold condition.

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