Daily Markets Briefing: STI down 0.4%

Index likely to consolidate around current levels.

OCBC Investment Research said:

Retreat on Wall Street overnight and an indifferent Nikkei start could continue to weigh on local sentiment today, especially as the long weekend approaches.

In any case, we already saw a decline in interest yesterday, where the STI slipped 0.4%, and penny stocks dominated the action.

For now, the STI should continue to consolidate around current levels, albeit with a modest downside bias due to pre-holiday profit-taking.

We peg the initial support at 3231 (centre of Bollinger Band). But a breach of the next key support at 3210 would trigger a parabolic sell signal, leading to a deeper pullback to 3187 (lower Bollinger band).

On the upside, 3275 (upper Bollinger Band) is likely to be the initial hurdle ahead of 3300.