STI officially enters the bear market!

On 25/May, Singapore shares end lower Tuesday as commodities & transport stocks took a beating due to worries over Europe’s debt problems and rising tensions in the South Korean 

STI ended 73.26 points (2.7%) lower at 2650.61 with higher VOL of 1.61 billion shares traded compared with 1.08 billion shares Monday. In the broader market, losers outnumbered gainers 595 to 69. Today selling down really scared buyers away due to the fact STI just broke the critical support at 2665 and techinically enter the “bear market”. 

Headline in STI

Before market close

The news over the weekend that Spain's central bank had taken over a relatively small savings bank CajaSur has caused fearful investors to sell euro and stocks on Monday.

In addition, worries for slow economic growth heightened to another level when the news broke out that Korean peninsula are currently following an investigation into the sinking of a South Korean warship near the disputed Yellow Sea border in March.

Singapore Tourism Board reported that visitor arrivals increased 20.4% on year in April to 938,000 which is the highest ever for the month of April.

Important Resistance of STI: 2665

Immediate Support of STI: 2600

MY sentiment on STI: Today STI fell below the critical support of 2665 to mark a “lower low” and close 2651.

The long black candle with very little upper/lower shadow has shown the determination of the selling down pressure with higher trading volume compared with the past few days.

Both RSI and MACD are in oversold region and do not seems to indicate any signs of rebound in short term.

Technically STI has already entered the bear market and these symbols will actually scared buyers away. Lastly we would advise investors to stay sideline at least for this week unless shorting.