Cyclical blue chips that are components of the Straits Times Index continue to push higher following months in the doldrums.
Keppel Corp closed at $5.15 on Nov 20, near an upside target following the break out of its base formation at $4.60. While short term indicators are approaching the top end of their range, with stochastics poised to flatten and turn down, and 21-day RSI at just short of 70, its highest level more than a year, it is possible that prices consolidate their recent gains. Since quarterly momentum has broken above its own resistance and its equilibrium line, and is likely to rise further, the consolidation is likely to be modest, with support at $4.92. A subsequent move above $5.15 would take prices towards $6, the level just before prices tumbled in August.
