Current Trend for the Straits Time Index (STI)

Finally the STI has broken down last week on heavy volume as US indices retrace from their  highs and it seems to have caught local traders by surprise by the depth of the selling which broke through the support level of 3190 mentioned in last week’s market analysis as well as the previous low of 3100. With macro factors such as rising interest rates on US treasuries as well as the stalemate in negotiations in the ongoing trade war between US and China weighing on global markets, we do expect STI to continue it’s downtrend.

After such a steep sell off we do expect some bargain hunting in the STI this week which could be a “Dead Cat Bounce” as the sentiment is still very bearish and any adverse news can trigger another round of huge volume selling which could …