Singapore: STI Index (.STI) manufacturing expansion eases in June
SINGAPORE’S manufacturing activity continued to expand in June but at a slowing pace, with the Purchasing Managers’ Index (PMI) down a marginal 0.2 point to 52.5.
This was the third straight month of deceleration, although conditions remained expansionary for the 22nd straight month. The PMI is a leading indicator of economic activity, with a reading of 50 and above indicating expansion.
The Singapore Institute of Purchasing and Materials Management (SIPMM), which compiles the data, attributed June’s reading to slower growth in factory output, new orders and new exports, as well as slightly lower inventory levels.
Stocks of finished goods expanded at a faster pace, with the index hitting 52.9 – the highest since February 2011.
Singapore’s performance was in line with regional conditions, with the Nikkei Asean manufacturing PMI slipping to 51.0 in June from May’s four-year high of 51.4.
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 3,392.89.
The projected upper bound is: 3,299.63.
The projected lower bound is: 3,164.87.
The projected closing price is: 3,232.25.
A big black candle occurred. This is bearish, as prices closed significantly lower than they opened. If the candle appears when prices are “high,” it may be the first sign of a top. If it occurs when prices are confronting an overhead resistance area (e.g., a moving average, trendline, or price resistance level), the long black candle adds credibility to the resistance. Similarly, if the candle appears as prices break below a support area, the long black candle confirms the failure of the support area.
During the past 10 bars, there have been 3 white candles and 7 black candles for a net of 4 black candles. During the past 50 bars, there have been 19 white candles and 29 black candles for a net of 10 black candles.
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.
One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 31.9240. This is not an overbought or oversold reading. The last signal was a buy 4 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 26.06. 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 111 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 -94. This is not a topping or bottoming area. The last signal was a buy 4 period(s) ago.
The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a sell 41 period(s) ago.
Rex Takasugi – TD Profile
STRAITS TIMES closed down -29.760 at 3,238.940. Volume was 18% below average (neutral) and Bollinger Bands were 66% wider than normal.
Open High Low Close Volume___
Short Term: Neutral
Intermediate Term: Bearish
Long Term: Bearish
Moving Averages: 10-period 50-period 200-period
Close: 3,276.63 3,460.54 3,437.99
Volatility: 10 12 14
Volume: 258,093,424 266,394,032 235,957,824
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.
STRAITS TIMES is currently 5.8% below 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 28 periods. Our momentum oscillator is currently indicating that .STI is currently in an oversold condition. The security price has set a new 14-period low while our momentum oscillator has not. This is a bullish divergence.