SingTel – OCBC
Signs of weakness?
– SingTel staged a rally over the last 4 weeks that is showing signs of weakness at this juncture.
– First sign of weakness was observed as the price rallied on the back of declining volume.
– Second sign of weakness was observed by the price break above the 2nd of Feb 07 high of S$3.70 on 14th Sept which was accompanied by only a marginally higher volume. This indicates the breakout might not be sustained and could very likely pull back in the weeks ahead.
– Yesterday’s strong price move up seemed to indicate that the uptrend could head up a little more before we witness a reversal, given that RSI, stochastic and MACD have all broken above their downtrend lines.
– However, we are not ignoring the weak volume on the rebound and price breakout. We advocate caution and lightening up on positions as the rebound continues. Resistance set at S$4.00.
– We anticipate a reversal in trend in the weeks ahead. 1st support is set at S$3.60 and subsequent support is set at S$3.32.