Market Comments (STI) For Week of 19 May 14

The STI has been resisted at the level of 3,260 for several times and the resistance continues to be a fairly strong one. Technically, STI is currently trading a rectangle pattern for the past 4 weeks with the top at 3,285 and bottom at 3,220. I would expect this this tight trading range to be broken soon. However, it is still hard to say whether it will break above 3,285 or remains in the trading range for a while longer.

As you can see, the signals from MACD and RSI are conflicting as the index is currently not in trend. Hence, it is always recommended to look at real market actions instead of indicators.

Given the imminent release of corporate results, it seems that there are more potential upsides for Index.