Chart Source: Poemsview 21st April 2021
Since our last blog post just a week over ago, we started seeing the Straits Times Index slowly peeling away. It had actually tried to break above our breakout level but failed to do so and got slammed down instead. With such a move down, we might see it move lower to the uptrend line of around 3120 also around the 50ema, Banks are the usual suspect as they take up a bigger weightage in the STI component.
The next few support might be around 3060 at the gap support and if that fails to hold STI might cover the gap to 3020. If we do reach that level some bargain hunting might be good. A pullback to 3020 represents about 6% from the high of 3221 which is actually healthy. So don’t be surprised if STI does pullback to that level. Don’t get too used to just seeing the ups and know that market moves up and down.
So trade with care and always have a trade plan and know your time frame. Traders might have been caught with this pullback and might end up picking up shares and being a mid term investor. So ensure you are discipline when it comes to trading or investing.