Straits Times Index faces strong sideways resistance at 3630 level.

Last week was a bearish week for Straits Times Index as profit pressure dominated the market during the last few days of the week. The week had a strong start but right after Wednesday, the market gapped down strongly on Thursday. This gap down action could be due to multiple index components going on Ex-Dividend. Further Ex-Dividend was seen on the next day which caused STI to close at a lower level. This “false sense” of selling pressure could have led some traders to exit the market without realising the impact of Ex-Dividend. Hence, STI was seen closing with 31.83pts lower, ending at 3545.38 level.

Has STI’s bullish momentum stopped after last week’s bearish action? Will further bearish movement happen this week?

Let’s look into STI’s chart to identify the momentum.

Trend: Possible sideways to uptrend, 20 wma …