Is the bear losing it energy? Is it time for Long?
In my blog, I have been trying to analysis and trace Wave Movement and Fibonacci Retracement for our reference. Volume Analysis is an important aspect of determining the strength of the Bear Movement. Traditional Technical Indicators are lagging signal, it will only indicate to you a signal that is 1-2 days late.
For the last few weeks, I was pessimistic about the STI index as it exhibited negative signal. But now, looking back and analysis the Volume for the past 3 weeks - indicate that there is a high probability of a technical rebound of we might be near to our Bear Season.
Why I say so?
In every near-end of Bear Market, there will be a Surge + Peak on Selling Volume. You don't usually see such signal very often - I would say "Once in a BLUE moon". Breaking a Fibonacci resistance would need a Strong Sell Volume, it's not like a typical classical resistance where no volume could break it. The further it goes, the more the Surge Selling Volume will need to be generated. If the volume is only slightly above Weekly Average, the Bear is still very much in control. Thereby, entry is not that recommended.
Will the Volume indicators show us otherwise?
Yes, but it is at low probability, if you look at DJI at Oct,Nov 2008 and Feb 2009, the market is trying to push the index very low, but the Support is extremely strong and then on Feb 2009, a Very Strong Rebound occurred - that was the start of another Bull Run.
What will be the STI Support level?
- It should be at 2680. An average down strategy might be useful for fundamentalist, try only average down entry at next Fibo support - 2240.
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