The global stock market has been running on a bull upward trend in the past 2 months. I have mentioned last week that a market correction is expected and we need to trade with extra careful. The market correction day is finally come in both global stock market as well as Singapore Straits Time Index.
We shall look at the Singapore Straits Time Index today!
Singapore STI Stock Market Trend
There are some bad news circulating in the market today. Sony has just released one of the greatest loss they have in 14 years and they expect to continue in the loss till 2010. US jobless rate is also climbing high.
We can see that the Dow Jones was in the red in the past 2 days and definitely this weak market sentiment has spread to the Asia market as well. Singapore Straits Time Index is also correcting downward from its high achieved last week.
Using candlestick analysis, you can see a doji formation after the bull run in the past 2 months. That was the first and earliest indication that a market correction is coming.
You can subsequently see a long dark candle follow, that is the second indication. Volume is also diminishing drastically that suggest loss of momemtum to drive the market upward. Therefore, you can see the market continue to dive.
Now, where do you think the STI will head to? Where is the support.
Singapore Straits Time Index Stock Market Trend
Support of Singapore STI
The immediate support that I am seeing is the 2,000 level which is close to the 38% Fibonacci support and also very near to the 200d MA line. 20d MA is trying to break up the 200d MA now but this is a strong resistance and therefore it coincides with the fact that market is correcting downwards. This will all happen near the 2,000 point level.
If STI cannot hold the 2,000 level, then, it may continue to dive to the 50% or 68% fibonacci to find a support there. If the market can hold above 50% fibonacci line, that another higher low is formed that will suggest end of the correction for the market to resume its uptrend. That will be the time I am looking for counters to long.
So, this is a good critical time to monitor the market closely if you have missed the bull run. Here’s the opportunity that may come again.
DISCLAIMER: This information is used for learning purposes only. It does not constitute an offer or solicitation to buy or sell. You should do your own analysis on top of my postings.
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