 (Updated 23/05/99)  N.B. Above Chart is abstracted from Metastock Program Last week was rather heavy on the news front, with many big events came out after one another. Started with the Monday announcement of Banking deregulation and the subsequent announcement of 1st Quarter GDP on Wednesday and the April Trade figure on Thursday. The Monday announcement of Banking deregulation had caught some surprise to the market, with an announcement of merging the Local and Foreign tranches of the big four local banks. This was an unexpected news for the market and immediately created a spike in STI index on Tuesday, mainly due to the big appreciation on the Local tranche price of the banks. Subsequently the good GDP and Trade figures had further boosting the STI index through the week. However, the market looks rather tired and overstreched. As such, this rally had merely delay the long expected correction and does not mean a new bull market is in the card. Expect market to test its next resistance at 1980 and may try for a new high again, but any upmove will probably be capped at 1995-2000 level before one more leg down to complete the correction that we are looking for. We are now entering into a sleeping mode on worldwide stock markets. For Dow Jones, it will probably be going sideways or drifting lower due to lack of economics data and corporate news in the coming week. As for Singapore, there are not much news on the domestic front, except a possible of further strengthen on inter-bank rate. For the region, the development of Indonesia's election remain a possible cause of some negative surprise and that the possible of devaluation in Argentina currency is also a cause of concern. For these reasons, I think we will see STI starts the correction again in latter part of the week and will probably drift towards the 1850-1750 range. Technically, STI has just completed its impulsive wave 3 and is now in the process of completing wave 4. We are continue to search for clues in the market to determine which scenarios posted in our "Long Term Perspective" is most likely to happen. But sad to say until today we have not found the clue yet though I am now more incline towards the first alternate count. However, we will patiently wait for the market to tell us the story and will inform you as soon as it is determined.
Events To Watch For The Coming Weeks/Month
|