Market weekend review + stock picks

For the last closing, the Dow Jones rally up quite a significant amount. This would imply that on Monday, the STI is likely to do well too. Nothing much on the DJIA chart and this is good. Fundamentally wise, there will be a outcome for the interest rate for the Fed meeting so it may affect the market slightly. I posted the DJIA chart for reference.

Dow Jones Industrial Average:


For the closing on this friday, the Straits Times Index managed to gap up and close the downside gap formed on the 22nd of this month. From technical analysis point of view, the closing of this downside gap is bullish. So we can see more signs from the chart that this correction is over.

Straits Times Index:


Last friday was a good time to pick up counters. I have been monitoring some counters which i think that they have some potential for profits and have put up their charts for reference.

China Hong broke it's historical high last friday. In my opinion, counters which have broke their historical high are likely to move upwards more simply because they have no prior resistance level. Another thing was that China Hong broke a 7th months old resistive trendline that has been tested 3 times so far. Notice everytime the counter touches this trendline in the past, it will rebound off this trendline and head downwards. This breakout was confirmed with heavy volume and another thing was that there was a bullish MACD line crossover.

China Hong:


Pan Hong broke it's historical high on thursday and it fell back on the trendline with low volume. Currently, it is supported on the trendline so this may be a good chance to enter.

Pan Hong:


On a personal note, i missed out on buying on China Hong due to fear on friday. A breakout of the historical high with heavy volume was confirmed on thursday and i should have bought it on friday. As i was going to buy the counter on friday, i saw it dipping below it's historical high value and i got fearful because of that. In the end, it rebounded and went to close way above it's historical high value. The good thing was that i told my fren to buy this counter. He managed to overcome his fear and buy on the intraday dip and is now sitting on a 7% paper profit. He was also the one whom i ask him to buy potential counters a few weeks ago which i was fearful to buy and he netted close to a 20 to 30% profit on these counters.

I think my fear is killing my ability to trade. Maybe that's why they say trading carrys a huge psychological factor too. This must be the 3rd time i failed to place a long due to fear. I must change my mindset regarding this.

Winning and losing is part and parcel of trading. I cannot expect to win all the time. If i wan to win all the time, i might as well put all my capital in the bank and be satisfied with the pathetic interest rate. Losing is alright as long as the amount of losses is strictly controlled. In any case, i am just a student. The amount of capital that i have now can be easily earned back within a few months when i start to work. I am trading now so that i can have more experience and training and not because i want to make huge profits. Furthermore, i should have more faith and confidence in my analysis and just place a long based on my analysis. Besides, my fren has been making profits based on my analysis too.

In any case, when the market opens on monday, i am just going to place longs on the potential counters and not worry too much about getting a good intra-day price. I should just buy 1st and not think so much instead of think too much and get fearful and thus missing out on a trade. All thinking should be done before the opening of the market. Once the trade is confirmed, i am just going to set a price alert and not look at it until the market closes.

STI correction may be over perhaps

Ever since the Dow Jones fell a few closings ago, it seems to me that the STI is now following the Dow Jones closely. This will be good as there will less guessing done on how STI will open the next closing since Dow Jones is now leading it.

For the Dow Jones, i do have some reasons to believe that the correction for now is at least over. It formed a hammer candlestick on the 100d EMA. The hammer candlestick is a bullish reversal candlestick and being able to test and close above the 100d EMA is good indeed. I did a quick check on the previous corrections for the Dow Jones and came up with the level that the RSI should fall to before it resumes it's uptrend. Currently, the RSI has rebounded off this level. All these technical indicators suggest that the correction should be over at least for now in my opinion. As for the strength of this rebound, i still can't tell as there are not enough technical signs to show so gotta wait for subsequent closings.

Dow Jones Industrial Average:


For the Straits Times Index, it tested the 50d EMA today and close above it with relatively heavy volume. A/D line bullish divergence is spotted and this is a strong signal since during this period, STI trend downwards yet the A/D line trend upwards. One worrying sign though is that the RSI has not reach it's oversold level yet but in my opinion, this is a minor hiccup.

Straits Times Index:


I feel that the sentiment of the market is that the correction seems to be over. Now this is subjective since this is how i feel. Not sure how come i felt this way but it seems to me that a lot of people actually accumulate during this correction. Well, i can be wrong perhaps. Today is a good day for investors to get their shares cheaply. For traders, i am not that sure cos the market is not that bullish yet.

On a personal note, i made the same mistake once again. A few posts ago, i blogged on how i missed out on CourageMa because it gapped up way too much on opening from support and i was too fearful to buy. In the end, CourageMa just flew off the roof, leaving me behind. Gapping up on opening is a sign that the overnight sentiment of the market has changed to being bullish and i should ride on this momentum ! Today, i woke up early to check the opening and saw that all the counters in the top volume list gap up. But i din enter again due to fear. I feel like strangling myself man after seeing the closings of the counters today. I must keep reminding myself of this mistake i made and not make the same mistake again.

Huge drop in Dow Jones

As my heading says it, the Dow Jones showed a huge drop on it's chart with a long black shaven candlestick. A drop of 2%+ for the latest closing is bearish since drops of 1% is common in the volatile markets recently. The drop was accompanied by very heavy volume for the past few closings and this is very bearish too.

So what can happen on monday ? Given that the drop for the DJIA occured on friday and we had a break of 2 days over this period, we will know it 1st hand whether the market sentiment has change by seeing whether the Straits Times Index will open with a gap down. But things are complicated since in recent weeks, STI dun seem to be following the movement of the DJIA. But i do tink that STI will tank on the opening on monday. Well i can be wrong too.

On a personal note, i been looking to this correction. I have been sitting on the sidelines for quite some time already ever since the market turn volatile and bearish divergences was spotted. Only when a correction happens, den there will be room for a healthy bull run subsequently. Corrections are always a good time for investors to get their stocks at a cheap price too.

Dow Jones Industrial Average:

Weekend review of market

First chart on this post goes to the Dow Jones Industrial Average. Currently it's supported on the previous resistance of around 14036. RSI is showing bearish divergence while MACD seems to be showing it too.

Dow Jones Industrial Average Chart:


Next on my list will be the Hang Seng Index. STI seems to be volatile these days and HSI seems to affect intra day movement on quite a lot of occasions. I added in the weekly chart cos i believe this will contribute to the forecast of any major movement and thus a better analysis can be performed. On the daily chart, both RSI and the MACD histogram are showing bearish divergence. For the weekly chart, we can see that HSI is supported on the trendline though the weekly RSI is showing bearish divergence too.

Hang Seng Index Weekly Chart:


Hang Seng Index Daily Chart:


On the daily chart, STI seems to be supported on the resistive trendline. But it rebounded off the resistance for the RSI technical indicator. On the weekly chart, it seems to reveal more things. STI formed a doji this week and by candlestick charting, it is suggesting that a top may have been reached. MACD and RSI are spotted having bearish divergences too.

Straits Times Index Weekly Chart:


Straits Times Index Daily Chart:


It is obvious from the charts of those indices that a lot of bearish divergences are spotted. Divergences are not signals that we must act upon immediately but they give warning signs. We shall see how true this will turn out to be. I am still waiting patiently for the bearish divergences to disappear and the increasing index to be confirmed by increasing volume. The market is volatile now with movement of 1%++ up or down in any single trading day so i am getting wary.

However, my hands are getting itchy. I feel that the marine stocks are creeping silently upwards. This can be seen in the TSC sector index and a few of the marine stocks in my list of charts. Here's one for reference.

ASL Marine formed a dark cloud cover candlestick on a previous resistance on low volume. This suggest that this stock should trend sideway or downwards. But this candlestick was formed on a low volume suggesting there may be some upside. All 3 technical indicators are showing convergence with the price action. Things will be good if it breaks it's prior resistance with high volume.

ASL Marine Chart:

A shooting star

STI currently resisted at the previous resistance of around 3652. Given that it formed a shooting star on today's closing, it is not likely to break this resistance level in the short term though this resistance in my opinion is a minor resistance level.

Strait Times Index Chart:


Dow Jones currently trending sideways as seen by the rectangle and it is supported on the shaven long white candlestick made 5 closings ago. Nothing conclusive to say about Dow Jones as of now.

Dow Jones Industrial Average Chart:

STI not following Dow Jones

Dow Jones has been heading north for the past few closings and we can see that the volume has been rising too so volume is confirming index action and this is healthy indeed. Currently, the support is near 13700 and hopefully we will be seeing it testing the 14020 region soon.

Dow Jones Industrial Average Chart:


The Straits Times Index dun seem to be following the movement of the Dow Jones and i am finding this very puzzling. STI reacted 1st to the Dow by having a huge gap upwards and it has been heading south slowly ever since. Let's see how STI test the upside gap in subsequent closing and see whether it finds support on this gap.

Straits Times Index Chart:


I dun post frequently on the SESDAQ chart but today i took a look at it. There was a gap formed in August and this gap was tested not long ago but it failed to close the gap. It will be significant if the gap is closed in future closings.

UOB SESDAQ chart:


I also took a look at the sector indices today and this is also something which i only do occasionally. I realise quite a lot of the sector indices are not moving up with STI despite the gap up. However, there were a few exceptions and one of them was the TSC sector. I tink it stands for transport, services and something else. Dunno what does the C stands for so if u can tell me, i will appreciate it :) The TSC sector is not only moving north, it has also broke it's previous resistance level. And another thing was that Jiutian and STX PO are inside this sector so this sector may be worth an another look.

I been visiting rallyartist's blog frequently and i realise he has not been updating recently. Den i went to the thread he starting in channelnewsasia and i found out he is in some kind of trouble. He posted on his experience and the actions he took that led him to the state he is now. It's a pity since his analysis was fantastic. Maybe the thing that struck me was how he turn 5k into 35k using technical analysis and it's proof on how technical analysis really works. I really learn quite some stuff from his experience and his thread can be found on http://forum.channelnewsasia.com/viewtopic.php?t=73861&highlight=

Breaking through the ceiling

Today seems to be good looking at the charts. For the Dow Jones, we can see from the chart that it has broke the stubborn resistance of the level of around 13700 and it broke with high volume. That is certainly bullish in my opinion.

Dow Jones Industrial Average Chart:


On the chart of the Straits Times Index, it seems to be pretty good. For the latest closing, STI closed with a huge upside gap which i haven seen for a really long time. However something disturbs me and that is the doji-like candlestick or perhaps a hanging man that was formed today with heavy volume. I reviewed the list of counters that i was monitoring and i hardly see any white candlesticks or any bullish divergence. Black candlesticks and especially dojis or hanging man were seen more frequently instead. Maybe the list of counters i am monitoring is not exhaustive enough but i can only come to the conclusion that quite a lot of ppl are selling into strength today. Well, perhaps i may be wrong.

Straits Times Index Chart:


It just occurred to me that i often distort the reading of the charts with the things i hoped for. I am hoping for the return of the bull quickly so i must say this is affecting my analysis of the chart. Perhaps, it is bad timing on my part that i pick up technical analysis on this last leg of the bull run so i guess i just have to be patient. Watching now for a higher high and higher low with volume expanding with increasing index action and vice versa.

Safe for a little while

True to my forecast, the shaven candlesticks formed on previous closings held as support as the Dow Jones closed with a doji-like candlestick testing the level of around 13040. Thus a higher low is still not being breached by the latest closing. This is quite bullish to speak of.

Dow Jones Industrial Average Chart:


Looking at the chart of the Straits Times Index, there seems to be a breakout of the wedge formation and today's closing pierced the resistive trendline. The good news is the volume dun seem to be light today. However, i feel the trendline may not be that valid so in order to prevent whipsaw, i should wait for tomolo's closing. Otherwise it should be a good time to enter but with caution.

Straits Times Index Chart:


I tink this might be late news but i do tink that the shipping sector counters is in play perhaps. I notice STX PO and Jiutian have heading north recently. But they rose much faster than i expected. Currently i am waiting for it to retrace back but perhaps it may not happen at all. I posted some charts but i will not been commenting on them at the moment.

STX PO chart:


Jiutian Chart:

Weekend review again !

It is the time of the week to forecast the probable trend for next week yet again. I usually post on Sat cos on friday night, the Dow Jones still got one more closing to go, so there is no point to do any review since the Dow Jones always lead the Straits Times Index.

Anyway i did read up on Decipher's blog which is the blog named art of growing money yesterday. He dun post that frequently in his blog nowadays but he wrote a very detailed and good post on his blog for his latest posting. I am learning quite a lot from his latest posting and he is offering some insights which i have missed in my charting.

For the Dow Jones, it closed with a long black candlestick with heavy volume on the latest closing. Furthermore it broke the 50d and 100d EMA in one single closing. However a higher high and low has been confirmed so going by Dow theory, we are in a theoretical bullish phase though in my opinion, this is a weak bull phase.
I noticed that a few closings ago, there were a pair of black and white shaven candlesticks. These candlesticks can act as short-term support going by Japanese candlesticks charting so i drew a horizontal line at this level. Furthermore this level is the level where the higher low occured so this may act as a support again.

Dow Jones Industrial Average Chart:


For the Straits Times Index, a breakout of the wedge formation has been confirmed following a breakout above the 1.5 years old trendline. But notice how the volume has been declining so volume is not confirming the price action. Thus this bullish phase can be considered to be weak. The index is now above all the important EMAs and MAs so this is quite significant. If STI finds support on the trendline by forming a bullish candlestick on it, it may be a good time to place a quick long.

Straits Times Index Chart:


Honestly, i was getting ready to place a long if the Dow Jones did not break it's horizontal support near 13252. But alas it did so i am not going to review any counters. I do think that there is a chance to make a quick profit cos we are in a bullish phase though it's weak one. Longs may be placed but i think one should exit the moment the Dow Jones and STI hit their major resistance level. That will correspond to a DJIA level of near 13700 and a STI level of 3650.

"The market will exist longer than you so dun be afraid of losing out on any opportunity for there will always be opportunities coming your way."

Signs of recovery

Things are certainly looking better now. Looking at the chart of the Dow Jones, it found support on the 50d EMA. Notice how it closed with heavy volume and a higher high has already been confirmed since the latest closing has exceeded the prior high. Volume has also been increasing. The next test will be the 13700 resistance level.

Dow Jones Industrial Average Chart:


For the Straits Time Index, the chart is also looking good. It closed with a shaven white candlestick with heavy volume so this is a good sign. However the closing happens to close just below the 1.5 years old trendline so a close above it, like what i said in my previous few post, will be very significant.

Straits Times Index Chart:

Beginning of the week

Nothing interesting on the charts yesterday so din blog yesterday. Well, the market has been singing the same tune for the past one to two months so i am really doing lots of waiting now.

I spotted something on the STI chart today. The level of near 3406 is now acting as resistance. Coincidentally, the 100d EMA is near that level too. So there are two levels of resistance acting around the same level so this is one tough resistance to break.

I notice how STI has tested this level for the past 3 closings by having a high that reached that level but it failed to close above this level. If it can reach that level and failed to close above it, i consider this to be bearish. If it break above that level, that level will likely be a support level for the next few days. Notice also how the volume is also very light for the past 2 days but i am not drawing any deductions from this piece of information. Now i'm just waiting for a higher high to happen.

Straits Times Index Chart:

Weekend review

Kinda sad to see mimosa restricting his blog to invited guests only. He has been offering very good analysis of the market and i often visit his blog to learn more stuff. Well, i just lost one source of learning about the market :(

Looking at the chart of the Dow Jones for the friday's closing, it managed to break the resistive trendline that was being resisted on 3 occasions and found support near the 100d EMA which happens to correspond with the support level of 13252. This is definitely a good sign as now we have seen the Dow Jones making a higher low and it has closed above the 50d EMA. The next resistance is at 13700 so there will be some chance perhaps to add in counters and hold until the Dow Jones reach 13700.

Dow Jones Industrial Average Chart:


The chart of the Straits Times Index also displayed quite similiar technical factors as the Dow Jones. As said in my previous forecast, the STI closed between the 38.2% and 50% fibbonacci retracement. Looking at the chart of STI, i saw something which i haven seen for a long time and that is both price action and volume are increasing together. I consider this to be quite bullish as volume and price are valued technical indicators in classical technical analysis. Any increase in price action should be accompanied by increasing volume. However, this was only for the last 3 closings so more observations over the subsequent closings are needed. A close above the 50d EMA and the trendline would be very significant.

Straits Times Index Chart:

Middle of nowhere

Today i redrew the charts for the Dow Jones and the Straits Times Index cos things were starting to get messy. On a personal note, i dun reli like to add in the fibbonacci retracement level cos there are so many horizontal lines so i gotten rid of those on the Dow Jones chart. It still remain intact for the STI chart.

For the latest closing, Dow Jones formed a harami candlestick due to a black candlestick on the 2nd previous closing and a white candlestick on the previous closing whose open and close are within the black candlestick. The harami candlestick formation is slightly bullish so i am expecting the Dow Jones to trend sideways or go down until further technical indicators suggest otherwise. Notice also how the white candlestick has a heavier volume. Dow Jones will be hitting the resistive trendline soon so a break of this trendline will be good news since this trendline has been resisted 3 times.


On a side note, i kinda toy with the idea of the point of death on the chart. It's just a term coined by me cos i was wondering if the Dow Jones failed to break the resistive trendline at all and break the support of 12800 in subsequent closings, this may have very bearish implications. So the point of death is the intersection of the horizontal support line of 12800 and the resistive trendline. But i tink the chances of this happening should be quite low.

Dow Jones Industrial Average Chart:


STI formed a dark cloud cover today and the black candlestick today closed with a heavier volume. I am expecting it not to break the 200d EMA.

Straits Times Index Chart:


CSC has been in the top movers list recently. I spotted something bearish on this chart today. It formed a dark cloud cover on the $0.335 resistance with heavy volume. Notice how the $0.335 is very near to the 100d EMA which suggest that the 100d EMA is acting as a resistance. A dark cloud cover formed near a resistance level is very bearish so a trade exit should perhaps be warranted.

CSC Chart:

Rebounding off resistance

Through technical analysis, we saw how the Dow Jones rebounded off the trendline that was drawn on the chart a few posts ago and it closed down sharply on the latest closing. If the Dow Jones fall, it should land around the area of 13000 due to a confluence of technical indicators.

1. It is near the fibbonacci retracement of 50% and 61.8%
2. 200d MA is quite near the level
3. The previous low for this current trend and the previous high from the uptrend that ended in Feb 07 is near the level of 13000.

We shall see how the Dow Jones approach the 50% fibbonacci retracement which is an important landmark on the charts.

Dow Jones Industrial Average Chart:


Nothing much to say about the Straits Times Index. Currently seem to be supported on the 200d MA and subsequent trends will be dependent on the Dow Jones. I posted a chart for reference and future keepsake.

Straits Times Index Chart:


Ausgroup has retraced back from the breakout of $1.74 and is now forming a hammer testing the upside gap on the support level of $1.59 which suggest that this level is quite a valid support. We shall see how this counter moves in subsequent days.

The main thing to watch now is where will the indices be finding support at.

Ausgroup Chart:

Index forecast currently on track

Currently my forecast from previous posts for the charts of Dow Jones and STI using Technical Analysis is on track. Nothing unusual today, cos the market still singing the same tune and that is index moving up and yet the volume is declining.

Anyway take a look at the purple line which is touching the previous tops. I drew this line in the previous posts and on the latest closing of the Dow Jones, the index failed to move above this purple line and closed just on the line itself. A bit too coincidental ? That is technical analysis in action :)

Dow Jones Industrial Average Chart:

Volume not confirming rebound

Well, the above title of the post says it all. A very basic tenet of technical analysis is that volume should confirm price action. Basically if the price action goes higher, the volume should expand instead of decline. A look at the chart of Dow Jones reveals though price action broke out of the crucial horizontal resistance of around 13247, the trading volume was light. Thus volume did not confirm price action for this breakout. As of now, i expect this rebound to be weak. Some possible scenario would be that the price action rebound off the resistive trendline and get supported at around 13247.
There may be some profits to be made for ppl who contra or short but my trading time frame is much longer than this so my current position is to stay out and observe the market further.

Dow Jones Industrial Average Chart:


On a side note, i am reminded that the more times the market fails to make a higher high or break a resistance, chances are that the market will be 'lethargic' and a very steep correction will happen. It is like if u bang the wall a few times and the same wall still dun come down, probably u will give up and come back another day. Maybe banging the wall is not a very good example but it's the only apt one i can think of as of now.

Drawing near to end of week

I am eagerly waiting for the Dow Jones to close in a few hour's time as the closing can proved to be crucial for the trend next week. Nothing too technical on the Dow Jones chart for this post. No complex formulas for technical indicators to bother with. Just the simple old-school classical technical analysis and the basic concept of support and resistance with trendlines. There is just one thing to watch out for and that is whether Dow Jones can break the horizontal resistance of 13250 with high volume.

Dow Jones Industrial Average Chart:


Some bullishness spotted on the STI. A hammer or a near-doji was formed on today's closing and it tested the upside gap of around 3320. Notice that this hammer had a very long lower shadow and this contributes to the bullishness of the hammer. Coincidentally, 3320 happened to be the resistance level at around March this year. Thus the level of 3320 should be an important support level for the days to come.

But also take note that the STI still failed to break the trendline and the 50d and 100d EMA. I think i am getting contradictory :p

Straits Times Index Chart:


Today Ausgroup formed a harami which suggest that there may be a change in trend so gotta keep on observing the chart for this counter.

Ausgroup Chart:


The chart for Singtel taught me some stuff which i read before in a book but yet to seen in real charting before. I was reading one of Larry Williams books and there was a concept which i still remember it as the quick profit day. Basically, the price action would be trending sideway or forming a rectangle. If the A/D line suddenly shoot up while the price action is still within the rectangle, a trade entry is warranted.

Notice for the A/D line for Singtel's chart, it broke out of a horizontal resistance with a very steep gradient while the price action gap down. And soon after, price action broke out of the rectangle soon.

Since this is only my 1st time seeing this, i am not proposing that i should always place a long whenever i see this situation happening again. More observation is needed to confirm the validity of such a strategy. But meanwhile, i will just post this chart for reference.

Singtel Chart:

Rebound halted

Dow Jones made a higher closing but it was on light volume so it is still bearish in the short term. Now waiting for it to test the resistance of 13257.

Dow Jones Industrial Average Chart:


There were 2 downside gaps on the STI chart near 3212 and 3352. The downside gap of 3212 was closed on Monday but the downside gap of 3352 was not closed. STI tested and attempted to close this gap but failed to close it and this is a sign of bearishness.

Another thing was that today's closing was a black candle with low volume and that is a bullish sign actually so i am taking note of it. But meanwhile everything else still looks bad on the charts.

Straits Times Index Chart:


If u notice carefully on the charts, the same story has been repeating over and over again for the past one to two months.

1. Index fail to make a new high or break it's resistance
2. It den fall back to next level of support
3. It may hover around support or attempt to rally up but any rally was weak which was confirmed by light volume
4. It fell through support and land on the next support
5. Step 3 repeats again

A few charts caught my eyes today. The 1st one is DMX Tech. I been monitoring it for a few months already. It's interesting cos i never seen such huge divergence before. Look at how the A/D line is trending upwards at an exponential rate while the price action just keeps falling ! I visited some forums and i think there are some rumours of a takeover by other company. Maybe that explains it but it does not matter cos price action always precede news.

DMX Tech Chart:


The next one would be Jardine C&C. It caught my attention cos i saw it in the top price movers list. Well these days, banking stocks keep hogging this list so when i saw this, i tot i better make a chart of it for my observation.

Bascially it had 2 downside gaps and it is attempting to close the 1st downside gap but it failed to close it, forming a bearish engulfing pattern

Jardine C&C Chart:

Technical rebound perhaps

Looking at the chart of Dow Jones, there was finally a respite as it finally closed higher last friday. But still, the white candlestick was accompanied by low trading volume and this has been becoming a familiar sight. Notice how Dow formed a very strong hammer which was accompanied by a very long lower shadow and by friday's closing, it formed a morning star-like variation. However, with high volumes accompanying black candlesticks and low volumes accompanying white candlesticks which has been becoming very common nowadays, it is still not looking good technically. We will have to see how the Dow Jones test the 100d EMA and whether it will break the support-turn-resistance level of around 13260. Still gotta remind myself that the Dow Jones has failed to make a higher high and a higher low so i am still bearish.

Dow Jones Industrial Average Chart:


STI formed a hammer-like candlestick with significantly higher volume on Friday's closing. Since the Dow closed higher on friday, i believe STI is likely to have a small rally which will test the 200d MA.

I do believe that there will be a technical rebound going by how the charts are forming a lot of trend reversing candleticks. But i think it will still be short-lived going by the technical indicators so far. So just gotta keep on watching the charts.

A lot of counters are again positioning for a rebound but going by my previous posts, though counters maybe in a position for a technical rebound, it may not happen as a lot depends on the direction of the indices.

Straits Times Index Chart:

A greater gap down !

Today really 'no eyes see' for the chart of STI. It gap down with a even greater gap for the latest closing. Whether STI can close back the gap will depend on the Dow Jones. I noticed that from the chart of STI, it gap down effortlessly through the important 200d MA. Looking at the chart, i believe STI will either test the 200d MA or find support near 2930 due to the 2 factors below.

1. Near 2930 coincides with a fibbonacci retracement of 50%
2. Near 2930 was an area of support during March 07

Right now, STI currently is supported near the fibbonacci retracement of 38.2% and i noticed that around this region was an upside gap that was not filled during March 07 too thus this gap may be acting as a support currently.

Straits Times Index Chart:


I charted the support that Dow Jones can find around 1 month ago and the link is here

Anyway, it is really strange to me that though the stock market is quite bearish now, if u look all around u, u still can see speculators trying to enter the hot property sector where the prices of properties are still increasing and the government forecasting an even greater economic growth in the subsequent months. Analysts are still churning out reports that the fundamentals of the economy and companies are still solid. I do think that the stock market is a leading indicator of the economy so if the current situation turns into an even greater bear market, we should be expecting an economic slowdown soon i guess.