While STI rebounded from 2,650 to above 2,800 level, ST Engg still range bound between $3.00 to $3.30 level and the price movement lately is getting narrower to merely between $3.10 - $3.1.4. ST Engg perhaps is one of the STI component index stocks that yet to move up as STI rebounded. Relatively, it is also one of the component stock that stay resilient to selling pressure during the correction when STI dropped almost 15% from its recent peak.
Technically, ST Engg is being range bound between $3.00 to $3.30 level since Nov 2009 and lately a symmetrical triangle formation appears to be developing. Symmetrical triangle is a pattern continuation and after breakout it will follow the direction of its previous movement. Since Mar 2009, ST Engg has been on an uptrend and if the symmetrical triangle does breakout at $3.14 with high volume, there is a high chance it will resume its uptrend movement and potentially hit a target of $3.38.
Both the short and long-term GMMA lines are being compressed. Normally when both these set of lines are being compressed, the next movement will be expansion of both set of lines and a powerful price movement follow.
What to lookout for is
1. breakout price level at $3.14 with volume
2. expansion of the short and long-term GMMA lines
The consolidating trend of ST Engg will only be violated if the price dropped below the $3.00 level.
