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SGX Poised For Pullback After Recent Rebound
Trend Spotting | 27 December 2013
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By: Robin Han
Articles (102) Profile

Following the announcement of QE tapering during the recent Federal Open Market Committee meeting, the Straits Times Index (STI) started to rebound from 3,020 to 3,150 – a 130-point rebound as of 27 December. The resistance at 3,160 is quite strong, also, applying any technical oscillators (regardless which is your preferred) would show the STI as overbought. Technically, it the STI may have a pull back in the next few days.

Daily Chart For The STI

From the weekly chart, we can see that Singapore Exchange (SGX) has been a weak stock for a long period. Since the beginning of 2013, the highs of SGX have become lower and lower. Also, both MACD histogram and moving averages on are bearish indicating that the counter may remain weak in the long-term. From the daily chart, compared to the severe sell down in early December, the rebound over the past few days has been relatively weak. Technically, after recording 5 up candlesticks, the counter is overbought (regardless of which oscillator is being used).

Given its blue-chip status, SGX is likely to be affected if the STI were to pull back in the next few days. One may consider shorting the counter on strength during a strong rebound as it may have a pullback soon and continue the long-term downtrend thereafter.

Weekly Chart For SGX

Daily Chart For SGX

Robin Han is a Ph.D in Department of Chemical and Biomolecular Engineering and has got a solid foundation in the financial markets.

Please click here for more information about this author.

Singapore Exchange  8.220 -- --   
Business: [FY18 Turnover] Equities & fixed income (48.2%), derivatives (40.2%), mkt data & connectivity (11.6%).

Insight: Jan-19, 1H19 operating revenue increased 5.7% to $... Read More

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