STI chart.  Source from www.chartnexus.com

Since May 2008, we observe that STI has refused to break the preceding top. In other words, once STI starts to approach the previous top, selling pressure starts to mount. In such a market condition, investors may look at shorting opportunities whenever the index reaches resistance levels. We also observe that the 20-day MA is resisting the upward movement (bear rallies) of STI.

Let’s now look at 2 stocks with clear support and resistance levels.