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| Picture 1: Daily chart of STI, via TradingView. |
The bulls exposed its weakness
In my previous STI analysis article for the week of 20 July, I was expecting a possible price breakdown towards its 2nd support region. However, the bulls supported the price drop on 20 July (last Monday) and staged another bullish attempt towards its 1st resistance region on 21 July (last Tuesday).
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| Picture 2: Daily chart of STI depicting its bullish weakness, via TradingView. |
Nevertheless, the bullish attempt on 21 July did not touch its 1st resistance region and the day ended with a doji. This was unlike its previous attempt where its bullish attempt on 15 July managed to touch its 1st resistance region. Evidently, this is a sign of bullish weakness.
The bears have woken up
On Friday, the STI made a decisive breakdown below its 1st support region. It formed a low of 2,572.93 points - merely 0.7 points away from its previous low. Evidently, this is not going to be an uptrend and the bears have won during the week of 20 July.
It is highly unlikely for price to make a U-turn this time like what happened during its previous lower low at 2,572.23 points*. The bears have been very consistent in their strength over the past three weeks.
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| Picture 3: Daily chart of STI showing a symmetrical triangle pattern, via TradingView. |
Also, as mentioned in my previous STI analysis article (20 July), there is a possible major movement after STI consolidated in the symmetrical triangle since June. The movement is still currently playing out since the breakdown of its lower trend line on 17 July.
Bears charging ahead
With that, I will be re-iterating my outlook on the STI as my previous article. I am expecting STI to continue its bearish breakdown possibly towards its 2nd support region.
This is in spite of a possible pullback to retest its broken 1st support region first - now a resistance region.
*Jian Wu would like to clarify that the lower low of the chart was a typo error in his previous STI analysis articles. It is actually 2,572.23 instead of 2,572.33, and has been corrected.
