Expect muted gains today.
According to OCBC, the pullback on Wall Street overnight and further losses in the US index futures weigh on local sentiment this morning; the Nikkei is down 0.3% in early trade.
As before, the STI seems to be floundering just below the formidable near-term top around 2900; overall volume has also fallen by nearly 35% yesterday, even as the index eked out a meager 0.1% gain, OCBC said.
Here’s more from OCBC:
And with the daily MACD starting to converge for a potential negative crossover, the continued failure to convincingly sustain above this level is likely to see the index slipping back towards the 2800 support.
While investors will be keenly following the unveiling of the 2016 Budget later (from 3pm onwards), the upcoming long weekend could put a lid on the market.
Above 2900, we peg the next key hurdle at 2918 (38.2% retracement of plunge from 3549 to 2528).
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