Singapore: STI Index (.STI) hurt by losses in financial sector

Singapore: STI Index (.STI) hurt by losses in financial sector

Singapore: STI Index (.STI) hurt by losses in financial sector

U.S. curve inverts for first time in 12 years

Singapore hurt by losses in financial sector

Vietnam claws back ground to end 1.1% higher

Most Southeast Asian stock markets ended lower on Thursday, tracking a global downturn in equities as an inversion in the U.S. bond yield curve triggered recession fears, while the Vietnam index closed at its highest in two weeks.

For the first time since 2007, the yield on the U.S. Treasury 10-year note temporarily fell below the two-year yield, widely regarded as an indicator of dire global trading conditions.

The yield curve inversion has preceded every recession barring one in the last 50 years. Risk appetite was all but eradicated as the inversion came shortly after economic data showed China’s industrial output growth cooling to a more than 17-year low, pointing towards a slowdown in Southeast Asia’s biggest trading partner.

Adding to market uncertainty, no trade concessions were made by Beijing following the postponement of 10% tariffs on over $150 billion worth of Chinese imports by U.S. President Donald Trump, senior U.S. officials said on Wednesday.

Trump’s unpredictability with regards to trade escalation and de-escalation is also “making trading next to impossible to carry a short-term view,” Stephen Innes, managing partner at VM Markets Pte Ltd, said in a note to clients.

Trading was difficult “even more so with the markets risk barometers so intricately dialled into the U.S.-China trade development,” Innes said. Singapore shares closed at their lowest in over two months, hurt mostly by losses in the financial sector.

Oversea-Chinese Banking Corp and United Overseas Bank ended down 3.6% and 2.9%, respectively. Oversea-Chinese Banking’s shares dropped after Bloomberg reported it was weighing a bid for Standard Chartered’ Indonesian bank PT Bank Permata. 

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 3,238.01.

The projected upper bound is: 3,189.79.

The projected lower bound is: 3,061.74.

The projected closing price is: 3,125.76.

Candlesticks

A white body occurred (because prices closed higher than they opened).
During the past 10 bars, there have been 5 white candles and 4 black candles for a net of 1 white candles. During the past 50 bars, there have been 31 white candles and 18 black candles for a net of 13 white candles.

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

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 33.1049. This is not an overbought or oversold reading. The last signal was a buy 3 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 21.62. 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 27 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 -101.This is an oversold reading. However, a signal isn’t generated until the indicator crosses above -100. The last signal was a buy 1 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 26 period(s) ago.

Rex Takasugi – TD Profile

STRAITS TIMES closed down -21.510 at 3,126.090. Volume was 108% above average (neutral) and Bollinger Bands were 91% wider than normal.

Open     High      Low     Close     Volume___
3,095.8503,126.0903,084.0803,126.090 438,154,592
Technical Outlook 
Short Term: Neutral
Intermediate Term: Bearish
Long Term: Bearish
Moving Averages: 10-period     50-period     200-period
Close: 3,186.08 3,287.50 3,211.09
Volatility: 12 12 14
Volume: 235,534,896 217,907,168 209,580,352

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 down today (bearish) 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 2.6% below its 200-period moving average and is in an downward trend. Volatility is high 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 11 periods. Our momentum oscillator is currently indicating that .STI is currently in an oversold condition.

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