SINGAPORE (Mar 2): Here is a chart for our weekly technical analysis:
Straits Times Index (3,479, daily)
Medium- and long-term momentum indicators continue to weaken. This is despite the retreat by the Straits Times Index on Mar 1-2 finding support at the 50-day moving average, currently at 3,487. The STI is marginally below this level, but it hasn’t broken down. On Feb 9, the STI fell to low of 3,340, holding above the 200-day moving average at 3,328 before rebounding. The rebound high of 3,574 was reached on Feb 27. This level may turn out to be resistance.
Quarterly momentum is falling and is likely to meet with support at its equilibrium line. Annual momentum has drifted below its own moving average. Two-year momentum has turned down for the first time since Nov 2016, but its trend remains upwards. ADX continues to fall although DIs have turned neutral from a negative stance. Short term stochastics is at the top of its range. Elsewhere, 21-day RSI has turned down.
The net result is likely to be a further decline for the STI from current levels, with support appearing at 3,340. If quarterly momentum is at its equilibrium line by then, the STI should stage a rebound. Overall though, the largest gains are over.
