Market Outlook for 25/03/2011

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STI had confirmed breaking the 3010 – 3020 gap resistance yesterday as it started to trade towards the next gap resistance of 3060 – 3070 level. This implies that STI is still bullish and yet to show signs of giving up. Hence going forward, it should be testing the 3060 – 3070 gap resistance level.              
              
STi had a bullish candle yesterday and clearly shown that it is now trading above 20ma. The 20ma started to curl up slightly and could be ready to continue its upward movement. However, what is ahead is the gap resistance of 3060 – 3080 which confluences strongly with 200ma. This could be a tough level to break and a high could be formed there.  Stochastic is starting to show fatigue in the upward movement implying that the upside is getting limited. The bullish divergence signal is still intact despite such strong movement this few days. Hencefore, I expect the market to continue to have strength to move towards 3060 – 3070 level and might struggle to break that level today.              
              
The banks were generally pretty firm yesterday. UOB particularly had a very strong surge yesterday and had closed the gap resistance. Going forward, it might be testing 100ma as resistance. As least, UOB had managed to clear the 20ma hurdle. The offshores were struggling yesterday to retain their gains for the past few days. They ended up with white candle despite struggling to surge. Kepcorp is coming close to its major resistance of 12.18.              
              
The properties were one of the strongest sector yesterday as they continued to move higher. Citydev and Kepland in particular even went to the extend of testing it previous high. This movement tell us that they are no longer in downtrend movement. However, their indicators are starting to show fatigue and could have a chance of retracement for the next few days. The commodities were pretty lack of strength yesterday as they struggled to braek their MA resistance. Indoagri and Golden agri ended the day with a bearish reversal candle at the MA lines. This could imply that they maybe ready for a retracement.              
              
In conclusion, the market’s bullish can still continue. However, after reviewing the different sectors, it seems that upside is getting more and more limited. Indicators also shows that the bullish are getting tired. Hence, STI is quite unlikely to break 3060 – 3070 gap resistance today and might also have a chance not to test it today even. Therefore, going long now would be a big mistake. However, cautious shorting opportunity could be seen, but we have to be quick in the trade because of the bullish divergence in play.