The STI has rallied significantly and its ongoing ((D)) leg hints at further upside in the near term. Its 3,265 resistance zone continues to hold the key below its resistance zone. Thus, only by breaking it then we will see the upside resuming.
Our end-2021 target is 3,500, which is near wave ((D)) of the symmetrical triangle.
The index’s double three corrective wave will be considered complete once its 3,500 expansion level of waves (1)-(2) is met, as this is a sign of its impulse wave (3). Should that happen, we could see a return of the first wave of its larger impulse wave. This implies a higher probability of a break above its 2007 high, in the long term.
The STI has broken out of its immediate downtrend line. Uptrend is intact after a series of higher highs and higher lows.
Pennant formation is a sign of strong bullish continuation. Given this, we are confident the index has not reached its minimum expansion target of 3,444.61, which is its 161.8% expansion target of 2,208.42-2,839.39 and 2,420.27.
That said, we also do not discount a reversal and correction down to its support zone 2. If that happens, the index will form a bullish flag instead.
Source: Phillip Capital Research - 10 Aug 2021
Created by traderhub8 | Jun 12, 2024
Created by traderhub8 | Jun 03, 2024