Daily Markets Briefing: STI down 0.3%

Don't expect gains today.

According to OCBC, overnight Wall Street weakness is likely to continue weighing on local sentiment this morning, potentially extending yesterday’s 0.3% fall.

Here's more from OCBC:

We note that the index has lost nearly 3% since peaking at 3549 on 16 Apr; it is also near several key supports.

The first being 3446 (50-DMA) and then 3443 (lower boundary of uptrend channel since mid Oct last year), where a convincing breach of both could send the index back towards 3430 (61.8% retracement of 3356-3549 rally) or even 3404 (100-DMA).

However, the daily technical indicators continue to look pretty negative, with both the RSI and MACD still declining at a fairly decent clip.

Hence in the event of a technical rebound, selling into strength could be a better option for now. Near-term caps are likely at 3478 (30-DMA) and 3500.