STI Up Trend To Continue

Singapore stock market staged a strong recovery in 2010. The STI index is up 10% year on year with the index moving from 2897.62 on 31 Dec 09 to 3190.04 on 31 Dec 10. With 2010 behind us, where is STI heading?

The phase chart is suggesting continuation of the current up trend. The index is now near its 50 day moving average. The 200 day moving average is still rising with a positive slope meaning that the long term trend is still intact. The support level is at 3100 level and resistance is at 3220 level. The index looked to be forming a head and shoulder pattern but the index was above to rebound near its neckline. The index now has to go above 3200 level to break the current trading range of 3100 to 3220. Once this resistance is cleared, the next resistance is at 3300 level. In the mean time, the bulls should have the upper hand. Remember the trend is your friend, and that friend is pointing to further upward momentum. Happy 2011!