A Top is near.

I think we are near a top in the short term.

Today's top 30 volume has been infested by penny stocks while the blue chips are pretty much unwanted. Honestly i never like to emphasize too much on volume as part of my analysis as i feel that knowing that a volume is high or low doesn't give one an edge over others as i never believe high volume is good for further upside(look at how the stock market drifted higher on low volume during world cup) However, whenever the majority, in this case the retail investors turn bullish have balls so big to snap up penny stocks, the outstanding, intelligent contrarian would step aside knowing that there is only plenty of risk but little reward left on the table.

Although i am very much an opposition to the bull camp in the short term, that doesn't mean that i will short the market with both my fists. You see in bull market like this, it is never easy to profit on the short side. I believe many weak bears have shorted the market since mid July only to see the market grinding higher and higher everyday and now those weak bears who have converted to weak bulls and load up on the pennies will end up on the losing end again and the cycle repeats itself until their accounts go to zero. This is how the market works and this is how the majority with the herd mentality behaves and that is why 90% of traders/investors lose money. In bull market like this, the pullback will come swift and fast and when you least expect it and most likely few would be able to profit from it unless they take on big risk.

It is pretty obvious that STI is being resisted at the 3030 level and it needs to take a step back to gain more buying support. However, with strength seen in the US market but some form of short term retracement in the SSE, this divergence in market action puts STI in a tough position to make its next move. I think the market is vulnerable and it will sell off on any bad news or data. At the moment STI would probably consolidate or make a headfake higher to draw in more of the retail investors.