Singapore: STI Index (.STI) global economic slowdown and the China-U.S. trade war will affect this year’s developments in various sectors

Singapore: STI Index (.STI) global economic slowdown and the China-U.S. trade war will affect this year’s developments in various sectors

Singapore: STI Index (.STI) global economic slowdown and the China-U.S. trade war will affect this year’s developments in various sectors

Economists have become largely pessimistic of growth in Singapore’s manufacturing industry. The bearish forecasts were based on increasing trade protectionism around the world, particularly in the United States.

In a survey released on Wednesday by the Monetary Authority of Singapore (MAS), it was indicated that economic experts are expecting the manufacturing sector to slump by 0.2 percent, the Straits Times reported.

The previous estimation made in March was at two percent, indicating that forecasts were largely affected by the Singaporean Trade and Industry Ministry’s prediction of slower economic growth for 2019.

Economists noted that the global economic slowdown and the China-U.S. trade war will affect this year’s developments in various sectors. Furthermore, uncertainties regarding trade protectionism in other countries, particularly the United States, will have an impact on growth.

Last month, multiple outlets confirmed that the city-state’s factory activity slipped for the first time in three years. The Purchasing Managers’ Index in Singapore saw a 0.4 percent decline in May, as confirmed by the Singapore Institute of Purchasing and Materials Management (SIPMM) last week.

Despite increasing pessimism for Singapore’s manufacturing businesses, the MAS survey suggested that many economists have faith in the construction sector. They predicted that growth will hit 3.5 percent this year. The March figures stood at 2.1 percent.

Overall, the bias in prices is: Sideways.

The projected upper bound is: 3,285.47.

The projected lower bound is: 3,154.65.

The projected closing price is: 3,220.06.

Candlesticks

A big white candle occurred. This is generally considered bullish, as prices closed significantly higher than they opened. If the candle appears when prices are “low,” it may be the first sign of a bottom. If it occurs when prices are rebounding off of a support area (e.g., a moving average, trendline, or retracement level), the long white candle adds credibility to the support. Similarly, if the candle appears during a breakout above a resistance area, the long white candle adds credibility to the breakout.
During the past 10 bars, there have been 8 white candles and 1 black candles for a net of 7 white candles. During the past 50 bars, there have been 33 white candles and 16 black candles for a net of 17 white candles.

An engulfing bullish line occurred (where a white candle’s real body completely contains the previous black candle’s real body). The engulfing bullish pattern is bullish during a downtrend. It then signifies that the momentum may be shifting from the bears to the bulls.

If the engulfing bullish pattern occurs during an uptrend (which appears to be the case with STRAITS TIMES), it may be a last engulfing top which indicates a top. The test to see if this is the case is if the next candle closes below the top of the current (white) candle’s real body.

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 91.8509. This is an overbought reading. However, a signal is not generated until the Oscillator crosses below 80 The last signal was a buy 13 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 55.32. 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 7 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 7 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 5 period(s) ago.

Rex Takasugi – TD Profile

STRAITS TIMES closed up 12.920 at 3,220.660. Volume was 6% below average (neutral) and Bollinger Bands were 21% narrower than normal.

Open High Low Close Volume___
3,203.1803,220.6603,185.6703,220.660 196,186,496

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

Moving Averages: 10-period 50-period 200-period
Close: 3,166.45 3,262.71 3,177.03
Volatility: 8 13 15
Volume: 186,075,280 209,682,992 212,458,256

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 1.4% above its 200-period moving average and is in an downward trend. Volatility is low as compared to the average volatility over the last 10 periods. Our volume indicators reflect volume flowing into and out of .STI at a relatively equal pace (neutral). Our trend forecasting oscillators are currently bearish on .STI and have had this outlook for the last 23 periods.

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