STI back to 3300 but could be pullback in downtrend
3300 now resistance level
The Straits Times Index lost the 3300 psychological level on 16 September when we wrote this story “Losing key level a critical development for Straits Times Index“. In the post, we described 3300 as a strong level to watch. It is both a psychological level that has been tested before as well as in close vicinity to a major 76.4% retracement.
After reaching low of 3149.91 on 17 October followed by a V-shaped recovery, the STI is back to challenge 3300 but this level is now a resistance rather than support.
Before going any higher, Straits Times Index must overcome 3300.
Technical picture worse
These are challenges Straits Times Index must overcome to go higher. Put together, the technical picture suggests that the STI has in fact printed a down wave from mid-September to mid-October and that the current rally is just a retracement or pullback only.
- 3300 is well-tested (labels 1-3) and therefore a significant level .
- 3300 is enclosed between 61.8% and 76.4% Fib-Retracement levels (label 4) when we look at low at 3149 and different highs.
- 3149 low printed on 17 October is a lower-low that suggests STI has begun its down leg. A trend line produced from two lows and projected to the highs show us an equidistant channel that points to down trend as well (label 5).
- The index is resisted by a confluence of A) 3300 B) Fib-R levels and C) equidistant channel. It is a lower-high and could continue down trend sequence.