STI broke descending line, touched 2013YEC and first time trading above 200MA

Remember I kept highlighting this – March window dressing, fund managers will test the 2013YEC.  And the road towards 2013YEC is going to be bumpy.  I highlighted that since the third week of February.  I mentioned that in my blog, thrice.  The last one was on 14-Mar  http://achua138.blogspot.sg/2014/03/anyone-remember-3-important-things-that.html.  Anyone remember that?  Beside the 2013YEC, I also highlighted a few pointers in knowing the market is about to turn.  What are they, anyone remember that?  Yes, candle pattern especially at level and any pattern formed or changes like inverted head and shoulder, ...........? 

 

Now, let’s recap what happened over the past 2 weeks.  11-Mar, shooting star at descending line, followed by continuously three days gap down.  Then it was supported at FIBO 61.8%.  However, few days later it penetrated through the 61.8% support and reached FIBO 50%.  The beautiful part happened here, candle pattern NT2 formed at level.  And the second candle was an inverted hammer.  Next day, a reverse head and shoulder was formed too.  Yesterday, we saw a break out from the descending line.   Today, STI finally touched 2013YEC 3167 and closed at 3162.  Not only that, first time in the year of 2014, STI is trading above 200MA.

 

Where is STI heading towards?  And where are those support and resistant levels that we should watch out? 3167 is the first gate for STI.  STI needs to stay above this level before we look at second, third and fourth gates.  Second gate is 3200, third gate 3230 and fourth gate is 3280.  I will look at 3300 instead 3280.  Look at the chart, if STI can break 3300, where is the next resistant by then?  No right, all the way to last year 3465 high?  But for myself, I shall base on that moment situation to calculate the next resistant level, just like what I did for DOW and S&P.  From another angle, what if STI couldn't stand above 3167 and it turn south instead of heading north?  Look at those FIBO support levels that I drew on the chart, they are still valid.    

 

Having said that, do not forget to watch for candle pattern especially at level and any pattern formed or change like head and shoulder…….  And knowing who are the big brothers plus things happening around the world.  Next week there are couple of important reports to be release by the US – ADP, non-farm, unemployment rate……… Watch out on that.  April will be the month for companies to release their first quarter reports.  So make sure you are holding the correct stocks/counters.  Last but not least, world cup will be held in Brazil on this coming June.  So watch out for the curse of “Sell in May and go away”.