STI index daily chart - testing trend line support

I posted an analysis of Singapore Straits Time Index index two days ago. The analysis was based on weekly charts and shows that index was treading carefully on the support line, with a descending triangle formation, that caution to be taken from any trades. For today's post, will be another analysis of the STI index, however it will be based on daily chart, and might provide a different angle for analysis.

From the chart, it can be seen that price action is still moving within the uptrend channel formed from more than 2 years ago. The high in first half of 2013 was a bump and run breakaway from the uptrend channel but was subsequently correct in May'13. Price then continue to move within the channel band in a narrow down-channel manner (enclosed by the 2 blue lines) till the recent drop that see price hitting the trend line support line (look at smaller red circle).

With the price treading closing on the trend line, a break off with force below this trend line and the horizontal support line (bold brown line) towards 2900 should indicate end of current uptrend. Should this happens, TP is expected to be around the bigger red circle (around 2700). It is where the downtrend channel (blue line) and red horizontal line support will meet.

Positive things from the charts are the technical indicators; MACD and Stochastic. (green circle) Both shows that are current price is at its low and a rebound is about to take place. Stochastic line moving across its signal line indicates the price is slowly moving up from its low. MACD histogram is decreasing, shows that the selling strength is dwindling.