Daily Markets Briefing: STI up 1%

But expect a pullback today.

According to OCBC, the sharp drop on Wall Street overnight could spark a similar pullback in the local bourse today, especially after the STI’s strong 1% rebound.

Here's more from OCBC:

As before, the medium-term outlook for the STI remains largely bearish – the 30-DMA (3304) is still converging towards the 100-DMA (3299) for a negative cross-over. 

Furthermore, the STI failed to clear the near-term hurdle at 3260 (38.2% retracement of smaller rally from 3050-3387) yesterday.

As such, there is a good chance that the index could take out the initial support at 3221 (38.2% retracement of 2953-3387 rally, also 50% retracement of 3053-3387 rally).

We peg the next key support at 3170 (50% retracement of 2953-3387 rally); while 3299 (100-DMA) remains the key resistance.