The Straits Times Index fell further during the shorter week, to 2,529, down 45 points week-on-week, placing it well  below its 50- and 100-day moving averages, currently at 2,626 and 2,588 respectively. The chart pattern remains weak but some support could materialise at 2,499. The index made a low of 2,233 on Mar 23, and this is unlikely to be breached. Unfortunately, volume rose significantly on July 30, when prices fell, and this is a sign of supply selling, suggesting that lower levels are likely in the first two weeks of Aug.  

Most indicators confirm the easier phase ahead. The 21-day RSI is drifting lower and it at 40. The low for this indicator is likely to be around 30 during a mild weaker phase, and around 23 during strong declines.

ADX has risen to 17 coupled with negatively placed DIs and further supports some weakness in the week ahead. Quarterly momentum is hovering around its equilibrium line, and appears poised for a breakdown.

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