Tuesday, 27 August 2013

STI heading south .....

11 August, I posted that STI has started the Wave C, and it is heading downtrend. Looking at the chart today(below), this is confirmed when 50MA cuts the 200MA, and this is an indication that the trend has reversed to downward. So are we at the start of the Bear market, well, according to many experts, any index has to correct about 20% to 25% before it enters the Bear zone. At the moment, STI is still quite a distance from there, at this point, it just meant that the trend has changed.

So is it a good time to enter and nimble a little now?

We should not invest against the trend, we should always go with the trend. Any rebound now might be a good chance for you to liquidate those lousy counters as low might be lower eventually. Personally, I will wait for STI to consolidate first after the downward trend slows down. I will also wait for the 10 weekly MA to trend up and lastly, STI has to stand above 3185(pivot point). Once all this is in place, it is then highly probable that STI trends up.

Related post: Sti wave C

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