Bears were caught off guard
In my previous STI analysis article for the week of 29 June, I was looking at the bears to continue its bearish momentum and accelerate to bring STI down to its 2nd support region. Last Monday, on 29 June, bears did made an attempt and formed a lower low at 2,572.33 points.
It seemed like the bearish momentum has indeed accelerated with the breakdown of its 1st support region, but the bulls made a surprising counter-attack which caused STI to make a U-turn over the next four days. The bulls, had apparently won during the week of 29 June.
Downtrend still remains
Despite the bull's victory, there is still no confirmation that the trend has changed as STI is still in a downtrend. The bears did formed a lower low on Monday, plus the fact that STI is still below its previous high of 2,688.99 points.
What can we expect next week?
As STI touched its 1st resistance region, I will be looking at possible attempts by the bears to pull the price down back to its 1st support region early next week. The 1st support region will therefore, still be a very important region to look out for any price action from there.
Coronavirus situation in US and Singapore GE2020
The coronavirus situation in the US is getting worse, as its 2nd wave caused a spike of nearly 55,000 cases in a single day. The economy is being dealt with further blows and will get more and more unsustainable should it continues to worsen. The STI will inevitably be affected by this situation in the US.
Also, the Singapore GE2020 will also be a major event to the STI. The GE polling day will be held on Friday (Friday is a declared public holiday) and next week shall be a four-day trading week, as the market ends its trading week after Thursday. The GE2020 results will be announced on Friday night, which might create an uproar in STI the week after.
