FTSE Straits Times Index (FTSTI) – Uptrend can be sustained

The Singapore market was extremely bullish last month after about a month of consolidation in June especially after breaking above the 2,400 points resistance level. The bulls continue starts to dominate the market in early July and the STI rallied 326 points or 14% in a month to close at 2,659.20 points end of July. The Singapore market is one of the best performing markets in the Asian region last month. The benchmark index has already increased 82% from the low in March this year.


Daily STI chart with volume as at 31 July 2009 using NextVIEW Advisor Professional

Technical indicators turned positive again especially momentum indicators that measures trend strength. The RSI, ADX and Momentum indicators continue to make new highs since early July and this means that the current up trend or rally can be sustained. Therefore, there is a high chance for the STI to climb higher but there is a technical resistance at 2,680 points, based on the 50% Fibonacci retracement level from the end-2007 to early-2009 bear trend. If the STI is able to break above this resistance level, then the next resistance level is at 3,000 points. Support level remains at 2,400 points with a minor support at 2,500 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.