Daily Markets Briefing: STI down 0.2%

Brace for another decline today.

According to OCBC, sharply lower Wall Street close last Friday could weigh on local sentiment and see investors continuing to take profit on recent gains – note that the STI was down another 0.2% on Friday, extending Thursday’s 0.2% decline.

Here's more from OCBC:

However, note that the STI has rallied some 12.7% since 17 Oct to a recent 3549 high, hence a pullback is probably quite healthy; both the daily RSI and stochastic indicators still show the market as quite overbought.

For now, we peg the initial support at 3476 (38.2% retracement of recent run-up from 3357 to 3549), ahead of 3453 (50% retracement).

On the upside, 3538 (upper boundary of uptrend channel) is the first resistance, ahead of 3549.