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STI breaks out of minor resistance, setting upside target

Goola Warden
Goola Warden4/17/2020 07:35 PM GMT+08  • 2 min read
STI breaks out of minor resistance, setting upside target
SINGAPORE (April 17): Chart breakouts show potential. Sometimes we never get to the potential. Still, for the Straits Times Index, there is good news, and bad news. The good news is that the STI has broken above a resistance at 2.561. The bad news is the
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SINGAPORE (April 17): Chart breakouts show potential. Sometimes we never get to the potential. Still, for the Straits Times Index, there is good news, and bad news. The good news is that the STI has broken above a resistance at 2.561. The bad news is the breakout took place on low volume and volume continued to contract as the index struggled to make headway.

All is not lost, though. The STI remains above its breakout line. And, quarterly momentum continues to recover. This indicator is now within a whisker of moving above its own 50-day moving average. The STI’s 50-day moving average is at 2,781.

The break above 2,561 indicates a target of 2889. Let’s say 2,890 to round up the numbers. Interestingly, 2,891 is the beginning of a gap —which looks like a breakaway gap— from which the STI broke below a minor support. At the time the STI reached 2,891 on March 9, the moving averages had already performed dead crosses with each other.

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