Volatility is back in the market. Dow went to 9787 levels during Thursday session, showing us how ugly the market can get when bad news hit the market especially when we have such a huge rally that took us from the March 2009 lows till the April 2010 highs.
For the STI index, the initial knee jerk reaction took the index below the up trend channel line. The index managed to recover some early losses and is now at 2821 level. This level is close to the up trend channel line.
Given Dow’s performance on Friday, it looks likely for the index to test 2700 level soon. If this support cannot hold, then the next critical level is 2424.
