In last week, STI gain 41 points from the opening of 2960 and close higher at 3001. A white candle sticks with short upper/lower shadow affirms on the slight profit taking from the investors.
Key Economics Data report:
U.S. markets will be closed on Monday for the President’s Day holiday. The Euro ministers will be deciding on a 130 billion euro bailout plan that would stave off default for Greece.
European Central Bank plan to swap its Greek bonds for new bonds which will help it avoid the steep losses private investors are expected to take.
Technical Analysis on STI
STI index re-test the critical resistance at 3005 for the 2nd consecutive week but failed to break out.
1) In weekly chart, a white candle sticks with short upper/lower shadow which indicates that investors remains firm on the strong economics ahead.
2) The weekly trading volume fell as STI approaches the critical resistance at 3005.
3) MACD and RSI indicators are bullish as RSI trend upwards.
4) STI is currently supported by the major support at 2936
5) The major resistance at 3005 is likely to cause a lot of issues to the bulls.
Important resistance of STI: 3005 (Daily charts)
Immediate Support of STI: 2936 (Daily charts)
MY tactics: STI has re-tested the critical resistance at 3005 for the 2nd consecutive week but failed to break out due to the overbought market. The resistance at 3005 is expected to be very strong. Thus we suggest to buy only on pullback.
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