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Price Index of HDB resale flats vs STI 12 SMA on a quarterly chart
Technical analysis can be applied into just about everything . So I download the Price index of HDB resale index (PIHDB)from the HDB website.
Please go to www.collinseow.com to see charts
I then plotted the quarterly chart for the STI and apply a 12 simple moving average(SMA) on the STI( red line).
pls go to www.collinseow.com to see chart
Superimposing the 2 charts you can see , whenever the STI crosses below its 12 SMA , the PIHDB will also starts it downtrend.
This happen in 3rdQ 1996 and 1stQ 2001. Whenever the STI crosses above it 12 SMA in 1stQ 1999 and 2nd Q 2003 , the PIHDB resume its uptrend.
So the question now is it the time to sell or buy ?
One thing for sure , just looking at the STI alone it is not the best time to buy.However,if the STI below the 12 SMA at around 2900 , this may be a indication to sell.
This is just a trivial technical analysis on the PIHDB.
Best Regards,
Collin Seow
P.S: my view remain the same for the STI ie , sell on strength and reduce.We have yet to see total despair which is a buy signal.
remain cautious for the 1st half of this year.