Since the astonishing rally beginning in March 09, STI has entered a seven months consolidation range since Jan 10. Now, we are again approaching the well-watched 3000 mark, and something that is being scrutinized always gives us great trading opportunities. At this turning point, i guess the golden question to ask is if STI will continue to be trapped in its 300+ points trading range or is the next up leg going to begin? Today's front page article on the money section of the Straits Times focuses on the bearish sentiment and worrying economic development despite the 12% rally we had since early June. From an intermediate term basis, i think this is a very bullish contrarian sign, as i have no idea how on earth would people still have so much skepticism after such a huge rally. The market is never make mistakes. Only people do.
I think this is certainly enough fuel now judging from the market sentiment for the next leg up. My money is on STI to break and stay above the 3000 mark by next month. However, in the short term the market is overbought and we might see some retracement. My next post i will be selecting some stocks that has great upside potential.
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