The index (today’s high so far at 2639) is a whisker away from the half way mark (2643) between 3831 peak and 1455 trough, and is poised to

match or even better May’s 417-point surge from 1930 to 2347. Measured from this month’s 2235 low, a similar point rally will take it to

2652. The first leg of the crash from Oct 2007 peak of 3831 had stopped at 2747 in March last year followed by a rebound to 3270 in May 22.

With 2608 taken out, 2750 is the logical next target, although the actual multi year resistance is 2892, ie the 2007 low followed by the 2006

closing high of 2919. This level is also around the 61.8% Fibonacci mark (2923) between 3831 and 1455.

Judging from the ferocity of blue chip buying in past few days led by banks and properties, there is a diminishing chance of a repeat of the

past 2 years’ bloodshed which in 2007 started in August and resumed from November that year while last year it dragged longer from June to

October. That was not the last of it as we saw another downleg before the final bottom on March 9. Thus extremely oversold market conditions

lasted in varying degrees for over 15 months and we are now merely into the 5

recovery and taking this broad perspective, too much weight should not be attached to technical indicators.

On that score, using the argument that the market is currently highly overbought would not hold water with investors/traders who believe that

intra-day profit taking episodes would correct the overheating while the broadening of trading spectrum now taking S-chips as well after the

recent scare surrounding many of them, is another positive sign that the days of staying cautious and sidelined are over.

Having broken out of the long term downtrend channel on the monthly chart and just beginning to re-enter back into the uptrend channelth month of market
  Tuesday, July 28, 2009

drawn the March 2003 low of 1171, the STI appears to have further exciting upside to the 3000 level. (see chart). Support has been uplifted