Market Technician

IEF (US): ETF Continues to trade higher on the back of a less hawkish outlook.  Disclaimers apply

  SGDMYR: SGD's upward trend against MYR has broke a key trend line, suggesting change in momentum. Thus, we do not see further upside for SGDMYR for the time being.  Reduced political uncertainty, FDI inflow, less pressure from USD and Bank Negara's intervention could be the drivers for the change in momentum. Disclaimers apply

  Thoughts on the Week Ahead:  Week of July 29, 2024 Equities markets experienced volatility over the previous week before rebounding on Friday evening. Both the US S&P 500 and Singapore's STI are trading near their technical support levels of 5,400 and 3,400, respectively, while the HK Hang Seng Index continued its downward trend. The market has largely priced in the US Federal Reserve holding interest rates steady at current levels, with investors awaits Chair Jerome Powell's speech for clues on inflation and potential rate cut expectations. Bond prices remained strong , and we maintain a cautious outlook for the week ahead until we observe a change in momentum for the equities market. Headlines for the week: - US Corp Earnings (MSFT, META, AAPL, and AMZN, SIA, UOB, Keppel, OCBC, Seatrium) - US FOMC meeting, NFP report, ISM Mfg PMI - China PMI,  - SG PMI, Unemployment Disclaimers apply

  Thoughts on the Week Ahead: Week of July 22, 2024 TSMC’s revenue increased by 40% year-over-year, yet its stock price declined by 3.55% for the day. Similarly, Netflix Inc. saw a 17% revenue increase but experienced a 1.51% stock price drop. Several factors could be contributing to the market’s volatility. These include valuations in the tech sector, interest rate expectations, and the potential impact of a Donald Trump re-election on taxes. We anticipate similar market behaviour this week as other tech giants release their earnings reports. There are currently no significant technical patterns suggesting a market reversal. Therefore, we will monitor sell-offs and wait for price stabilization before entering trades. Despite a recovery in the China A50 index, Hong Kong markets have not followed suit. Investor enthusiasm for Chinese markets remains subdued. The upcoming earnings season may offer more clarity on the equity market's direction. The Singapore market has weakened, and ...

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  Hang Seng Index (HSI) and Tencent (700) broke out of trading range. We expect both to head higher towards their respective targets. Disclaimers apply

  Thoughts on the Week Ahead:  Week of July 15, 2024 Following the release of the CPI data, the market now prices a 90.30% chance of a 25 basis point (bps) rate cut at the US FOMC meeting on Sept 18th . We have also observed a market rotation towards disinflationary trades. Here are some interest rate-sensitive asset classes, sectors, and markets that moved higher after the CPI report: •  Bonds (e.g., TLT, ZROZ) •  US Growth/Small Cap (e.g., IWM) •  Global REITs (e.g., SCHH, CFA) •  Utilities Sector (e.g., XLU) •  China and Hang Seng Indices (short-selling curbs also contributed to their rise) A Note on PPI It is important to note that Friday's US Producer Price Index (PPI) report did not decline in line with CPI. PPI is a leading indicator of US inflation. Short-Term Tactical for the Week Ahead Given the mixed signals, our strategy for the coming week will be cautious and selective for the US and Singapore markets. We favour the Hong Kong mark...

  AMD: The upcoming earnings report could drive AMD's stock price higher as the AI theme continues to play out. Technically, if the price crosses above $175, there is an expectation for the share price to retest the previous high of $208. The stop is set below $154.   Disclaimers apply.

  Tesla Inc (TSLA): Technically, Tesla's stock has exited its downtrend, and a potential reversal towards bullish momentum. However, we require more evidence of demand from trading actions. The first target is set at $300, with a stop at $177.   Disclaimers apply.

  Gold: Technically, there is an expectation for the precious metal to retest the high of $2,450 as the market anticipates the US Fed to cut rates due to more subdued inflation and some weakness within the jobs market.   Disclaimers apply.

  Week of July 8, 2024   "Oh my gosh! I'm Anxiety! Where can I put my stuff?" from the movie "Inside Out 2". Anxiety often strikes when deciding whether to enter a trade when markets are "high" and continue to rise. From my experience, position sizing and anxiety have an almost inverse relationship. Therefore, when markets are high but you still need to follow your trading process, reduce your position size. This allows you to participate with less anxiety, benefiting you as a trader or investor as you continue to follow your process.   US markets hit fresh highs this week, with the Singapore market also moving higher, thanks to the banking sector and SingTel. Meanwhile, Greater China equities continue to stay afloat at current support levels.   The next technical target for the S&P 500 is 5,680, while the next target for the STI is 3,500.   We will continue to look out for long trades in the coming week.   Headlines for the week: - US Jerome...

  US Banking Sector (KBE): Despite the overall equities market weakening in Friday's session, the banking sector rallied. This suggests that current economic conditions could continue to benefit the banks. 1. Elevated interest rate environment 2. Slow but growing economy 3. Continuing earnings momentum 4. Low non-performing loans Singapore Banks , could potentially emulate the performance of the US banking sector. https://www.businesstimes.com.sg/companies-markets/banking-finance/jpmorgan-raises-2024-interest-income-forecast-us91-billion Disclaimers apply

  Thoughts on the Week Ahead: Week of July 1, 2024 The US Presidential debate caused some volatility in Friday evening markets, as participants see the debate as favoring Donald Trump's return to the White House. Both equities and US Treasury bond prices fell after the debate. On the bright side, the PCE report was positive, with inflation meeting market expectations. While we remain optimistic about the S&P 500, its inability to break above 5,500 and its decline on Friday is concerning. We are closely monitoring market trading actions and the crucial 5,375 support level. In China, markets continue to face volatility. Our support for the Hang Seng Index (HSI) remains at 17,000-17,200. Meanwhile, the Singapore Straits Times Index (STI) has returned to its resistance level. We could see a decisive move up or down this coming week. We are cautious on the markets but will continue to identify trading opportunities in the coming week Headlines for the week: - US FOMC Minutes, Job R...