Friday, April 19, 2019

STI Analysis -- the next peak and trough ? (44)

Continued from STI Analysis -- the next peak and trough ? (43)

Before analyzing STI, will be looking at 2 other indices to provide a clearer direction for STI.

HSI
HSI has long been a leading indicator for STI as most will have observed how HSI intra-day movement can affect STI.


Above is the HSI chart clearly doing a 5-wave Elliott wave impulse.  The question is has wave 5 completed or still have a bit more to go.  After wave 5 what's followed shall be the corrective wave of A-B-C.  How deep the correction will depend on the degree of this 5-wave impulse -- a wave 1 of higher degree or a wave 3 of higher degree.



Above is the snapshot of of the Fibonacci Calculator taking in the exact happened value for wave 1 to 4.  The generated wave 5 value is 30842.298 as shown.  The highest HSI achieved so far was 30280.119, a 1.82% off the generated value.  The snapshot below that is from the Degree Calculator which calculates HSI from SuperCycle degree (top-down approach).  The generated M5 or I1 value is 30726.253 which is very close to 30842.298 (generated from bottom-up approach).  Thus, 30280.119 could be the end of wave 5 and HSI is now undergoing the corrective wave A-B-C.  Should it is not, then any further upside will be very limited.  As a whole, HSI is either already in corrective wave or still have a little bit more to go before correction starts.  This has put an indication that STI being always lagging behind HSI will soon go into correction.

FTSE ST REIT
The FTSE ST REIT index is another leading indicator for STI.


The above FTSE ST REIT chart clearly defined a completion of 5-wave Elliott wave impulse.  Like it or not, S-Reits is in correction phase already despite the current earning season still ongoing.


Above is the snapshot of the Degree Calculator for the ST REIT calculation.  This indicates ST REIT has completed 5-wave Minor degree or Intermediate degree wave 1.  The correction is Intermediate degree wave 2.  Wave 2 is renowned for deep correction (typical 61.8% Fibonacci ratio) so be prepared for more downside.

Both the 2 leading indicators in HSI and FTSE ST REIT signal STI correction should be coming soon.  Another interesting aspect for the 2 leading indicators is both of have a cleaner Elliott wave pattern than STI.  As a result, the Elliott wave analysis on STI is much more complicated just like is 2955.68 or 2993.42 the bottom for the Primary wave 2 correction ?

In previous analysis, have strike off 2955.68 as the end point of Primary wave 2 but now seem like this has to bring back.  


The above snapshot is the Fibonacci Calculator for both 2955.68 and 2993.42 as base of Primary wave 2.  For the case of 2955.68 as P2, STI is now approaching the generated wave 3 value of 3377.21 before wave 4 correction kicks in.  On the other hand, if 2993.42 is P2 then STI still have more room to move up (wave 3 = 3630.314) before wave 4 correction starts.

A point to note, for P2 = 2955.68 and 2993.42, wave 5 values are generated to be 3400.538 and 3731.297 respectively.  These 2 values should be the Intermediate wave 1.



The above is the snapshot for the Degree Calculator for STI for P2 = 2955.68 and 2993.42 respectively.  The top-down approach calculates I1 to be at 3662.785 and 3700.525 respectively.  For the case of P2 = 2955.68, there is a big divergence from the bottom-up generated value (3400.538) as above.  

So any coming correction for STI could be the Minor wave 4 correction as compared to both HSI and ST REIT which are in or going into the Intermediate wave 2 correction.  It appears STI still yet to near the end of Minor degree as compared to HSI and ST REIT, which is very lagging in general.  

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