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Bull 1: Bear 0
 
Singapore

Straits Times Index
 

From the recent low of 1455 made slightly more than a month ago, the STI has been on a strong bull run that seemingly defies gravity. All technical resistances that should have resisted the STI were broken through easily and for more than one month, there was only one clear profit taking that formed a low toward the end of March. This type of strong movement is a classic run arising from pent-up energy when a historical low is formed. Using the analogy of a spring; the tighter it is compressed, the stronger the rebound. During the run to the upside, the STI has formed numerous rising windows and this is something we need to take note of as each of these rising windows can act as future support zones.  Using candlestick analysis, falling window can also form a possible resistance and the STI is coming close to 2 major falling windows as marked by the arrows. The STI will need to clear the nearest falling window of 1880 for a possible upside to another resistance at 1936. A major resistance will be the falling window from 1992 to 2036 which will coincide with the 200-day moving average as the STI comes close to that region. This will form a double whammy of a very strong resistance. Support for the STI will be a small rising window of 1786 to 1797. Stronger support for the STI will be in the region of 1680 which is also very close to the 50 and 100-day moving averages. Using ADX indicator, +DI is on the upside with ADX line above 20 and rising. This indicates that it has a higher possibility of an upside as compared to the downside. Overall, STI has not had any significant retracement but if a higher low is formed at the support, it will be a good opportunity to look for stocks to buy for the upside.

 
 
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