Singapore: STI Index (.STI) trading sets stage for negative start
A steep fall in US stocks for the second straight day on renewed global growth concerns does not bode well for domestic stocks, which stare at a gap-down opening on Wednesday.
The only silver lining is the 6 per cent plunge in crude prices overnight, which could support the rupee and, thus, foreign flows. But a rising dollar index could become a worry.
Losers outnumbered gainers 86 to 37, or about seven securities down for every three up, after 60.4 million securities worth S$55.9 million changed hands.
Among the most heavily traded by volume, Ezion Holdings fell 2.4 per cent or S$0.001 to S$0.041 with 2.1 million shares traded. Genting Singapore Plc advanced 0.5 per cent or S$0.005 to S$0.925 with 1.9 million shares traded.
Active index stocks included DBS Group Holdings, down 1.0 per cent or S$0.22 to S$22.68; and SingTel, down 0.7 per cent or S$0.02 to S$3.05. SingTel is currently trading on a cum-dividend basis.
Overall, the bias in prices is: Downwards.
The projected upper bound is: 3,121.26.
The projected lower bound is: 2,953.19.
The projected closing price is: 3,037.22.
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 6 white candles and 4 black candles for a net of 2 white candles. During the past 50 bars, there have been 24 white candles and 25 black candles for a net of 1 black 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 (which appears to be the case with STRAITS TIMES). It then signifies that the momentum may be shifting from the bears to the bulls.
If the engulfing bullish pattern occurs during an uptrend, 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 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 35.6386. This is not an overbought or oversold reading. The last signal was a sell 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 44.88. 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 14 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 -119.This is an oversold reading. However, a signal isn’t generated until the indicator crosses above -100. The last signal was a sell 11 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 buy 13 period(s) ago.
Rex Takasugi – TD Profile
STRAITS TIMES closed up 11.660 at 3,038.650. Volume was 24% below average (neutral) and Bollinger Bands were 17% narrower 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: 3,060.50 3,110.98 3,324.05
Volatility: 13 17 16
Volume: 213,343,216 231,732,592 243,189,104
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 8.6% 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 28 periods.
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