Since hitting a high of 2424 on 2^nd June, the benchmark STI succumbed to profit-taking as it slipped 9% to register a low of 2212 on 24^th June. Current price action suggests that the STI is in a consolidation phase as it remains choppy around the 20-day moving average. In addition, the ADX is hovering below the 20 level; indicating a sideway market. Currently the STI is supported by a diagonal trend line from the 18^th May low which also coincides closely to the 50-day moving average which is now running at 2260. However the MACD is drifting lower since its peak on 8^th May and looking to test the zero line (a move below zero - a bearish centerline crossover implies that momentum has changed from positive to negative). Coupled with lackluster volume as STI bounced off the diagonal support on 8^th July, investors do have to be cautious now as a pronounced correction cannot be ruled out at this juncture. A clear break below the immediate support at 2260 may see a decline towards its stronger support at 2040. Key support may be at 1940 (former horizontal resistance now turned support) which also corresponds closely to the 50% Fibonacci retracement from the March low to the recent June high. On the upside, STI needs to overcome the resistance barrier of 2362 – 2424 to resume its prior uptrend to the next target ranging at 2504 – 2533, a falling window resistance gap