Mid-term trendline support at 1,766
By KEN TAI,
senior technical strategist,
KELIVE RESEARCH
(part of the Kim Eng Group)
DESPITE the recent pullbacks, the local bourse remains within wave-4 of the primary downtrend. In a complex wave-4 structure like the current one, the Straits Times Index (STI) may stage a correction before pushing up to complete the formation.
Unless the STI falls below the 1,766 support trendline, we consider the bear rally to be intact. On this premise too, we see scope for the STI to recover this week as it is still trading above the mid- term support trendline established over the past two months.
We would advise investors to cut loss only if this mid-term support trendline is breached, a scenario that would negate the recovery view and one that could potentially send the market towards the next support at 1,711. Although the upcoming Jan 22 Budget remains a possible re-rating catalyst in the very short term, it would be prudent to hedge some risks by going long on Reits.
By KEN TAI,
senior technical strategist,
KELIVE RESEARCH
(part of the Kim Eng Group)
DESPITE the recent pullbacks, the local bourse remains within wave-4 of the primary downtrend. In a complex wave-4 structure like the current one, the Straits Times Index (STI) may stage a correction before pushing up to complete the formation.
Unless the STI falls below the 1,766 support trendline, we consider the bear rally to be intact. On this premise too, we see scope for the STI to recover this week as it is still trading above the mid- term support trendline established over the past two months.
We would advise investors to cut loss only if this mid-term support trendline is breached, a scenario that would negate the recovery view and one that could potentially send the market towards the next support at 1,711. Although the upcoming Jan 22 Budget remains a possible re-rating catalyst in the very short term, it would be prudent to hedge some risks by going long on Reits.
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