All Eyes on how US and European policy makers contain the banking crisis

Thoughts on Week Ahead:
Week 20 Mar 2023

The US Federal Reserve recently injected liquidity into the financial system in an effort to stabilize the banking sector, and market is expecting a 25bps rate hike from the FOMC this Wednesday. Meanwhile, the technology and semiconductor sectors have continued to outperform, while Chinese banks have been quietly rising due to government efforts to boost economic growth.

Investors are diversifying into gold, which has risen 5.96% as the market prices in a potential peak in the interest rate cycle and a resulting softening of the USD.

In the travel industry, stocks within the theme are experiencing more price stability and demand as countries prepare for an expected increase in Chinese arrivals in the coming quarters. For example, Beijing Capital International Airport (694), which we shared, recently reached our target price.

Overall, while there are some positive trends in the market, it's important to consider potential risks and opportunities in each sector and to remain vigilant as events unfold.

China A50 Long-term Cycle, returned to bearish trend. We will reduce our positions in China A50 ETF if price falls below 61.80% fibonacci retracement.

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Wyckoff's Law of Effort

Law of Effort Wyckoff's Law of Effort states that on any single trading day (or week depending on time frame), huge volume (effort) push by participants should see huge price movement, resulting in a wide spread (long body). This is a basic principle of effort and result. However, as per Singtel's case study, we saw huge selling volume on 11 May, yet the price action only shows a narrow spread (small body). This divergence of effort and result in Wyckoff's Law of Effort principles, indicates possible exhaustion in selling or hidden buying. Thus, with a lack of weakness, Singtel should continue trading range bound for the coming days or weeks till further strength or weakness is observed. Swing Traders who trades range can consider positions at 3.70-3.72, with exit target 3.76-3.78.

DBS Group Holdings (D05): Upward Move Expectations

DBS Group Holdings (D05) Upward Move Expectations Technically, price trading above 36.58, could see DBS Group retest previous high of 38.55. Both Relative Strength and momentum indicator FFI are supportive of the move. Stop below 35.42 Disclaimers apply

Keppel DC REIT (AJBU): Expect price to trade towards S$2.00

Keppel DC REIT (AJBU) Expect price to trade towards S$2.00 We have observed a decrease in technical supply at the S$1.80 support area during recent trading sessions. Furthermore, a softer interest rate outlook could be advantageous for the Data Centre operator. Consequently, we anticipate the REIT to move towards our initial target of S$2.00, with the potential to reach S$2.20 if it breaks through resistance. Our stop level is set below S$1.72. Disclaimers Apply

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