Technically, STI long term trend is still neutral with short-term bias towards the downside more. DI pair though is positively spaced but with ADX signal below 20 level, the upside is lacking in strength. MACD signal starting to show sign of cutting down and with RSI and Stochastic signals both falling STI should have some more downside for the coming week. Immediate support and resistance are 1,710 and 1,900 respectively. A breakout from 1,930 could see STI heading towards 2,000 - 2,100 range. A breakdown at 1,710 probably will be seeing STI heading down to 1,630.
For the coming week, Singapore company will start to report their respective earnings with SPH leading the pack on 12th Jan 09. Earnings will be bad as compared to the previous quarter and potentially stock fair value will get downgrade by analysts.
For short-term investors/trades who believe STI could hit the 2,000 - 2,100 level by end of Jan should consider long position at the various support level.
For long term investors, with corporate earnings announcing the coming week, it is good time to read through the balance sheets and hunt for the quality stocks and buy into it when price becomes at attractive value. Spreading out the purchase would be good as it could minimize the downside risk.
