Brace for a pullback today.
According to OCBC, continued strength on Wall Street last Friday should keep local sentiment relatively upbeat this morning; the Nikkei is up 0.6% in early trade.
But the overall tone could remain somewhat cautious, as investors will still be looking to the Chinese markets for near-term cues, OCBC said.
Here’s more from OCBC:
As before, the STI needs to convincingly breach and sustain above 2600 before we see more buying interest coming back to the market.
If it fails to do so, we could see investors reverting to selling into strength and see the STI resume its slide towards 2500.
For now, we peg the initial support at 2521, ahead of the key 2500; above 2600, we peg the next hurdle at 2650, with the key hurdle remaining at 2700.
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