major exhaustion

today was a perfect example of exhaustion. initial gap up in the STI triggered intra day selling, which followed by a flurry of buying. from then on, STI began tumbling to close about 17 points below its opening. what does this mean?

the resistance was perfectly establish, intraday, at around 2303, a little short of my initial estimates of 2310. nonetheless, we can expect to see a further down move on the STI in the coming days. this is starting to get purely exciting. of course, there is always a possibility of the market going back up. just keep that trigger on the short side and look for potential selling signals.

july will be a trying month for equities. we may see a further retracement from the peak of 2400 not only to 2200, but even lower. that will be established later.

now why is this so? like i've mentioned before, the rally cannot last. when the fundamentals of the companies are still weak and posting losses, it is not possible for STI to keep charging upwards. now we will see the equities market moving back to value.