STI 17 Jan 2014

The bar for STI 14 Jan 2014 was the one that convinced me there is more downside ahead for the index. It was a gap down bar, with a tight range, accompanied by an increase in volume, relatively. Only thing is it closed near its day high but is still a down bar that tested and break the near support at 3119 region. Over the next 3 days, the STI tried its best to crawl up, literally. Regional indexes were much stronger than our local index performance. DJIA has 2 days of 100+ points, but the STI only climb up marginally. The red downward trendline will continue to be the resistance to watch. Unless it can be broken convincingly with volume, I will view any throwback as an opportunity for me to short the index stocks.

Looking at the bigger picture on the weekly chart, nothing much has changed. The STI is still in the midst of a consolidation zone, and trading is gonna be choppy. Not the best of times to hold stocks for a long period, but for hit-and-run, quick profits type. The STI is still confined in between the support at 2950 and resistance at 3270 region. It looks like we are experiencing a complex retracement. No new lower highs or lower lows formed; or higher lows followed by higher highs. In fact, I think there is a chance that we might form a symmetrical triangle on the weekly chart in the weeks ahead. The apex is probably still about 2 months away, but we should break out, either up or down, before we hit this apex. Lets watch.