SINGAPORE (Sept 14): Here are two charts for our technical analysis this week:
STI daily (3,142): Relief rally sets in
On Sept 7, the Straits Times Index formed a doji, a sign that down momentum was fading. On Sept 11, the index made a low of 3,102, and it subsequenty rebounded. The initial upmove is likely to face resistance initially at 3,191, and then at the declining 50-day moving average currenty at 3,239.
Short-term indicators are rebounding. The 21-day RSI has turned up at its 33 level causing a positive divergence between STI and momentum. Stochastics is also likely to turn up after forming a double bottom. ADX has turned down, as DIs are negatively placed, suggesting that the strong down momentum has ended for the time being.
The relief rally is likely to be temporary and the STI may not break above the 50-day moving average at its first test of the indicator.
Venture Corp (416.54): Testing support
Prices found support at $15.92 but the chart fomration looks weak. The stock has already fallen below the moving averages, with the 50-day moving average at $17.23. Indicators point to a likely breakdown, in which event the downside could be $13.20. A move above $17.23 would invalidate the downside.
