the STI has held pretty well. Last Friday’s
200 points drop in Dow Jones Industrial Average did not bring about a sell down
on Monday. It will definitely be a gap
down today. So where is the support?
The first support is at 2977 the pivot low made on 6 Sep. The next support will be at the 38.2% Fibonacci retracement level of 2938. If 2938 gives way, the index is likely to test the 61.8% level of 2846
MACD is bearish at the moment. Having tried to make a bullish crossover, the MACD histogram looks to be turning down. Such pattern failure usually brings in the sellers.
One slightly positive indicator is the ADX indicator. It is not shouting a sell signal right now with ADX below 20 level indicating that there is no strong trend pattern at the moment. The +DI looks set to go below –DI indicator suggesting that a more negative tone is forming.