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| Picture: STI daily chart, via TradingView |
Correction back to 3rd resistance
As mentioned last week, the STI had indeed underwent a correction back to the 3rd resistance after a long, sharp rally. Another extremely tall red candlestick was seen on 30 Nov, last Monday.
Since STI took a turn back from the 2,900 level, this shows that a temporary resistance was formed.
Support was intact at 3rd resistance
Over the next four days after a sharp decline on last Monday, buyers began starting to pick back up on the STI.
Tuesday, Wednesday and Thursday were accumulation days where "green candlesticks without a noticeable rise" was seen.
On Friday, STI opened above the resistance level and ended higher. The bulls were back in action again.
What can happen to STI next week?
The STI will be looking to return towards the previous high (resistance) prior to the fall - which is the 2,900 level as mentioned earlier just now.
Do beware! I personally do not think this correction is over. A correction should bring STI back much more instead of very little. This is more likely when the STI had already flew 500 points.
This 2nd bullish attempt may be a failure when approaching towards its previous high. Stay cautious.
