Do you remember trading during SARS period in 2002-2003? That’s seems like a long time.
I remembered that Strait Times Index and other regional market was plagued with events one after the other – Asia Financial Crisis, dot.com burst and followed by SARS.
It was a gloomy period, things were so bad that even Cathay Airways offered free hotel stay and free stop over in Hong Kong.
Back to 2020, the new virus, first reported in the Chinese city of Wuhan late last year, belongs to the same family of coronaviruses that causes SARS, which killed nearly 800 people globally during a 2002-2003 outbreak that also started in China.
Today, when I was interviewed by Lianhe Zaobao on what resulted in regional stock markets dropping, a plausible explanation is fear of Wuhan flu (caused by Coronavirus) could be spreading. This is could be further aggravated by the massive migrations of Chinese communities during coming Chinese New Year.
However, apart from fear of Wuhan flu, it is also obvious from CN50 chart that price is resisted by this long term trendline.
The fact that price is resisted gives more reason for market to sell on slight bearish news (for the moment).
It is amazing to see the convergence of technicals with news.
I had this long trendline drawn quite some time ago. This is the main reason why I have turned defensive since Dec 2019. In all my interviews with our Chinese media, I brought up resistance at 3280 countless times and caution against being too aggressively optimistic in this market.
For STI, a close below 3250 is a first sign of bearishness.
Singapore Reits as a whole been doing well recently. It is interesting to see how this income, defensive sector can hold up to prices if Wuhan Flu becomes a widespread issue in the market.
Forex System Expert, entreprenuer and a mother of two wonderful children. She is particular interested in using Reits to build a recurring income. Binni Ong just loves patterns/numbers and developed many mathematical-base automated trading systems. She founded TerraSeeds Market Technician Pte Ltd and onlineforexmaster.com. She was also invited by exchanges, brokerages and banks to speak in many investment seminars and panels. She has a Masters degree from NTU, Singapore. Get Free Telegram broadcast on our trade thoughts Free Telegram Broadcast
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