Based on the chart pattern, in early June, the STI broke below support at 3,160 or thereabouts. This level looks like the break of a neckline, with the chart pattern resembling a double top. The break below the neckline support indicates a downside objective of below 2,900, based on the chart pattern. Any rebound is likely to meet with resistance at 3,160.
The market turned volatile during the week of June 27 to July 1, proving that the rebound a week earler was temporary.
The Straits Times Index ended the week at 3,095, losing all the gains it made in the week of June 20-24. The index has now moved marginally below the low of 3,098 it made in mid-June.
