While I was on hiatus in the latter months of last year, I still monitored the markets. The general story went like this: US markets soar, European markets take cue, and Asian markets disappoint (“ex-Japan” - as they like to say).
Singapore counters did not give much reason for cheer. I remember vaguely seeing a potential inverted head and shoulders that should have been on the radar of some chartists. It is not the best-looking of its kind but the general idea is there.
The then unconfirmed pattern resulted in a downward breakout. It can be seen as a successful downward breakout actually. But I will not go into it anymore.
For an index like the Straits Times Index – STI, one way of analysing it is to look into the constituent components. After a brief look at all of the charts, my simple view of the local bourse is that many counters are either range-bound or trending lower. Property counters were downright bearish quite a while ago, and the picture does not look very different now; the telcos look like they have finally reached a fair level after years of the market pricing them higher; and, the Agris look either flat or in downtrends. The only sector that may surprise is banking. (Even then, my analysis in future may point in the opposite direction).
In the charts below, you will see a similar story: major support breached, and a clear case of what seems like more than the start of a downtrend.
While western markets resume their upward trajectory, I think the large-cap local stocks will continue to disappoint. Some are even presenting downtrend trading opportunities. However, I do see some of the second-, third-tier counters that look promising. As the weeks and months go by, I will upload some of those charts.
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