No surprise then, that week-on-week, the Straits Times Index declined, falling 44 points to end at 3,205 on Sept 2. The decline takes the STI below the confluence of the 100- and 200-day moving averages at 3,218 and 3,237 respectively. This caused quarterly momentum to fall back to its equilibrium line, and there is a danger that this indicator breaks below equilibrium. If so, the STI may stay weak. Immediate support is at 3,180. A break below this level may indicate the next downside objective.
Although global equity markets may remain under pressure against a background of rising risk-free rates, rising interest rates and quantitative tightening, the Hang Seng Index could be moving in a counter-cyclical direction versus global markets. It remains above its twice tested support at 19,268. Resistance is scaled down to 20,170, the high reached on Aug 29. A breakout above this level would cause an interesting development on the charts.
