Dear readers, the Singapore stocks market benchmark indicator, the Straits Times Index (STI) fell into oversold territory yesterday. Oversold territory means a RSI region of below 30.
From my technical chart, it was the fifth time that the STI has gone into oversold mode for this year 2022 to-date. The first time the STI was oversold was from mid Feb to Mar 2022. The stocks markets became more volatile from Apr to May 2022 with the STI entering into the oversold region for three times.
The next technical support for the STI is at around 3,040. Based on yesterday closing of 3,097.43, this means a next southing of the STI by about 2% from yesterday’s close in a near term.
The lowest the STI has gone to, in recent years was to 2,233 in Mar 2020. Do you think that compared with 2020, the global stock markets have more potential to head down to at least this level of 2,233? If so, the STI could likely head south by another 28% to revisit this Mar 2020 low.
Expect the STI to head south even more if the current market volatilities are leading to the next stock markets meltdown since year 2009.
My advice for investors who have a significant investment in equities: if selling your stocks amount to realized losses, do not do so unless you really need the liquidity.
And my advice for All investors is to enter into the stock markets when the stock markets undergo correction by picking up good stocks on the cheap at one of the market bottoms.