Straits Times Index (Week of 7 June 2021)

The Straits Times Index (STI) opened this Monday morning at 3,169.69 points, how will it fare in the near future?

After reopening most of Singapore's economy over three phases, the STI made a bullish streak towards its psychological 3,000 level, pierced through and went on to even hit the 3,200 level. 

The 3,200 level was in fact, the level prior to the lockdown in April 2020 and therefore we can say that the index did make a full recovery. 

Uncertainty returned in Singapore 

As soon as STI reached the 3,200 level, consolidation started to happen with the high of 3,237.23 points made on 30 April. The distribution phase ended with a breakdown of its 1st support region just as Singapore announced the tightening of its Covid-19 rules (Heightened Alert) amidst infection in the community. 

Overreaction to the Heightened Alert

Despite the breakdown, price flirted around the 2nd support (a breach down towards the psychological 3,000 level) and rebounded strongly back its 1st support.

This rebound did not touch 3,200 points at this point in time and is currently hovering around its 1st support. 

What can happen to the STI?

The taskforce will be providing updates on the Heightened Alert at the end of this week and the movement of the STI would depend largely on whether some rules will be relaxed.

As long as the number of cases do not rise over the next few days, all could be well and we can expect a return and even a rise beyond the 3,200 level.