Daily Market Opinion for 20-Mar-2014

STI ended bearishly yesterday as concerns weighted on the FOMC meeting. STI opened with a strong gap down last night, ignoring the trend of the regional market. This gap down action triggers selling sentiment into the market which caused STI to drop gradually during the day. A low of 3068 level was hit before STI attempted to recover its losses. Losses were recovered before closing hours which helped STI to maintain itself close to the opening level. STI closed at 3080.75 level with 13.09pts down. Last night, DJI was seen closing lower by 114.02pts. How low will STI attempt to trade today? Has the downtrend been confirmed?

Yesterday’s bearish movement had triggered higher possibilities of downtrend formation for STI. With its 50ma support line at 3084 level being broken, it is an indication that lower high formation had formed. Therefore, STI will ...