Evening all,
While international markets were looking for clear direction, the STI picked up some points. The STI is above the 200-day MA for the first time in around six months; an easy to spot downward parallel channel is violated on the upside too. A check on the components of the STI reveals “the Jardines” and a few others were drivers of the recent uptick. Outside of the blue chip category, the property counters are enjoying a good run. Quite a few stocks that I blacklisted into my bearish list have been showing signs of life in the last two weeks or so of trading. Naturally, I am disturbed, and am worried for those that I have a position in; but, these are only short-term swings, and only time will tell if they grow into clear mid-term trends.
In the chart below, I highlight a small head and shoulders pattern that formed somewhere near the top of the parallel channel. At that time, it seemed like the head and shoulders appeared at an opportune time: resistance from the upper limit of a channel (I do not use channels for trading but I still lay them on a chart for illustration), and rounding off just below the 200-day MA – ready to send the market below 3,000, perhaps. Far from that result, the STI flew up.
While I am still comfortably a bear, I shall see how the recent strong showing pans out.
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