Mag7 Narrowing & Week Ahead

Mag7 Narrowing & Week Ahead
Following the "Mag7" earnings announcements, the market saw mixed reactions. While Facebook (META), Amazon (AMZN), and NVDA gapped higher, momentum wasn't universal across the group. Notably, Netflix, outside the Mag7, also posted a positive post-earnings jump.

Our ongoing focus revolves around deciphering whether this momentum signifies a narrowing concentration of market strength or a broader market expansion. By closely monitoring earnings reports across various sectors, we aim to ascertain whether the market is evolving beyond its traditional reliance on the Technology and Communication sectors.

Shopify Inc (SPOT): In trading range, Demand increasing, potential upward to continue. Target at 95, stop at 70.

American Eagle Outfitters Inc (AEO): In trading range, Supply exhausting, potential increase in demand. Target at 21.70, then 23.66, stop at 19.80.

Key events this week:

Alibaba (BABA): Tune in for Alibaba's earnings on February 7th for valuable intel on Chinese consumer spending and insights into the country's economic health.

DBS Earnings: This key Singaporean bank's results, also announced on February 7th, will serve as a barometer for the local market's sentiment.

Lunar New Year Break:

Please note there will be no weekly market update next week as we in view of Lunar New Year weekend. We wish you all a joyous and prosperous year ahead. Headlines for the week: - US Corp Earnings (MCD, CAT, PLTR, PYPL, SPOT, BABA, DIS) - SG Corp Earnings (DBS) - Global PMI reports, US FED Chairman 60 Minutes interview on CBS - China CPI - SG Retail Sales

Disclaimers apply

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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