Yesterday's market: The SET increased to move above our target of 1500. However, the index continued to be volatile after there was no fresh catalyst to provide support.
Today's outlook: The SET has climbed to our target. In addition, the gain was quick, continuous, and quite sharp. Given that, investors need to be cautious over selling to lock in profit, which will pressure the index to fall. This morning, investment sentiment in foreign equity markets is bright after global crude begins to stabilize following falls early this week. Moreover, U.S. and European corporate earnings come in strong. However, Asian stock markets only modestly gained. What's more, some were volatile and moved downward. With that, FSS expects the SET's upside to be more limited. Furthermore, there is risk that the index will fall shortly as some investors remain on the sidelines, waiting for ECB meeting results and its stance over measures to cope with Brexit in the afternoon of today.
Strategy: Since the SET has significantly increased, FSS now expects the index to fall. For this reason, we now recommend that investors wait to buy on weakness. If the SET continues to increase, investors are suggested to sell into strength to lock in profit.
Support: 1506-1503 , 1500-1495
Resistance: 1513-1515 , 1518-1520
Source: fnsyrus.com / settrade.com
