Singapore STI: Likely to test next resistance level at 2,400 points

Market sentiment and confidence in Singapore seems to be getting even stronger by breaking the 2,000 points resistance level and closing at a 7-month high. The benchmark FTSTI closed at 2,329.08 points at the end of May. The index has climbed 56.8 percent from the low in March. Market continues to be bullish despite weaker technical indications. Investors are responding to recent economic developments both locally and internationally. Total manufacturing output of Singapore in April rose 24.7 percent on month.

The next resistance the benchmark index would most likely be at 2,400 points, the 38.2 percent Fibonacci retracement level from the longer term bearish trend since October 2007. There were no major correction from the current bullish trend and the market is climbing exponentially. The momentum indicators are still in divergence which means weaker up trend but there is a high change of the index testing the Fibonacci retracement level above. There has to be more positive catalysts to push the market beyond this level. Support level is currently at the previous resistance level at 2,000 points.

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Article contributed by Private Trader, Market Expert, Trading Coach and Chief Market Strategist of Nextview, Mr. Benny Lee. For more articles and commentaries from Benny, click HERE.