Daily Markets Briefing: STI up 0.3%

Index failed to clear the 3200 hurdle.

OCBC Investment Research said:

While the STI ended 0.3% higher yesterday, it failed to clear the 3200 psychological hurdle, despite a brief spike.

As such, we could start to see more profit-taking interest creeping into the market, especially after the muted showing on Wall Street overnight.

Note that the 50-DMA has just cut down on the 100-DMA on 5 Jul, suggesting that the medium-term outlook is still slightly bearish.

As before, we think that the market is probably keen to retest the key 3135 support (61.8% retracement of the rally from 2931-3464).

A breach could herald a deeper pullback to 3000 and even 2931; but should it hold, it could form a base for another rebound to at least 3222 (upper Bollinger Band).