SINGAPORE (Feb 8): In the short term, the market may consolidate. Quarterly momentum has turned down, as has short term stochastics.
Quarterly momentum remains in positive territory, and its uptrend remains intact for the time being.
The Straits Times Index appears to have found resistance as it approached its 200-day moving average currently at 3,234, a level that coincides with the Jan 18 intra-day high of 3,250.
Interestingly, the 50- and 100-day moving averages have made a positive cross, and are now rising.
The earlier break above 3,190 indicates a target for 3,420. Support and the fail safe level is at 3.190 below which the upside is no longer valid.
Annual momentum has stabilised below its equilibrium line but its main trend has not turned up. Hence, the STI’s recovery may be checkered despite the positive cross by the medium term moving averages.
