I am sure you would have known that STI has recently been subjected to weakness after dropping from a high of 3464. On Friday it closes at 3311 points. Oh, what a drop, 150 points drop in 6 trading days.
Throughout these few months, we have been preaching all to be careful and wait for the big drop to occur. Although STI dropped 150 points, we still think that it does have more room to drop IF US does fumble. So far, US is still relatively strong.
Looking at the STI, we feel that short term wise there is a support at 3300. Breaking down through 3300, STI may have the chance to drop to 3100.
IF STI does drop to 3000-3100, we feel that it will be a terrific chance finally to buy some stocks cheap.
But having said that, if 3300 support holds, STI will have the chance to move pass the 3450 resistance. We did mention about 3450 being a resistance on radio 3 weeks ago. But we never expect such a drastic drop given that US stock market is still relatively strong.
In the radio interview, we also mentioned that STI has a MUCH MUCH bigger resistance at 3600 if it is reached this year! Do take note that 3600 is a MUST SELL figure for both short and long term investors.