 (Updated: 07/02/2000)  N.B. Above Chart is abstracted from Metastock Program Last week was a short pre-Chinese New Year trading week. With uncertainty clouded on US future interest rate direction, many traders chose to take a long week end holidays then to remained active in the market. As such, the market was rather quite and STI was again trapped within a small trading range. The same happened in Sesdaq counters, with the index trapped between 148-142 level without much clues as to what will happen next week. As per our expectation, there was no pre-Chinese New Year rally for Singapore stock market, thought we had witness some good rallies in Hongkong and Taiwan. With the dragon year finally arrive, can we expect a better year ahead? Can we expect a good rally to celebrate the arrival of Golden Dragon since Chinese are known to be ancestors of Dragon? With last week FOMC meeting passed by without any surprises ( an
increase of 0.25% and a tightening bias), the uncertainty on US future interest rate shall
remain the main factor to influence US stock market. Traditionally, February is a quite
month for US stock market. With corporate results season more or less over, the market is
now re-focusing back to the usual economic data. As such, every inflationary data will be
scrutinize in detail for any possible faults. It is certainly not a good sign for stock
market. Especially when the majority of stocks in US are now heading lower, and only
depending on Technology stocks to push the indices higher. The uncertainty in US market is
therefore remain a main factor influencing our local market movement. At the same time,
the uncertainty in Indonesia politic will have a great impact to our market too. Although
we can expect good corporate results from most of the listed companies in Singapore, such
results may have to take a back seat if there is any surprise from US stock market or
Indonesia. We still believe Dow Jones will eventually test its major support at 10400. As
for STI, it will continue to trade within the range of 2300-2180 in the coming week, while
2200 remain the main supporting point for the index. Only a break above 2340 or below 2150
will tell us where the medium term direction is for the market. Expect Sesdaq to trade
within the range of 148-142 level and track closely with STI too. Aggressive investors who
would like to pick bottom, may try to buy some technology or banking stocks. After all,
these are the stocks that had shown good strength while other sectors continue
to remain in the down trend.
Any break-out on these levels, will certainly affect our STI movement. Technically, we are now in 5th wave. If we are right, the market has just completed the 5th of the 1st of the wave (5) and is now in its abc 2nd wave. In this case, we may have seen a short term top at 2582.90. Alternatively, we may have just completed the 5th of wave (5), we can only confirm the case when STI breaks below 2150. If this is so, we may be experiencing a big correction soon. We shall let the market tell us the story next week.
Events To Watch For The Coming Weeks/Month .
|