Earnings not as gloomy

Thoughts on Week Ahead:

Week 1 May 2023

Earnings not as gloomy

Last week's earnings reports from major tech companies, including MSFT, GOOGL, and META, exceeded expectations and suggest that consumer spending may not be as weak as previously thought. This positive news could potentially boost sentiment in the equities market.

Recent data on the Consumer Price Index and related indicators indicate that inflation may be reaching a plateau. Additionally, there are concerns about a potential economic slowdown in the fourth quarter of 2023. As a result, we anticipate that the US Federal Reserve will likely announce one final 25bps rate hike in the current cycle at the upcoming FOMC meeting.

From a technical standpoint, the S&P 500 has managed to stay above a key resistance level. Despite a relatively weak reading, the volume-based momentum indicator Fund Flow Index (FFI) remains in positive territory. This combination of factors suggests that the S&P 500 may continue to trade higher in the coming week(s).

Headlines for Week Ahead:

US FOMC Meeting

US Jobs report

US PMI

China Eco Data

SG PMI

US/China Earnings (Apple Inc, Qualcomm, Yum Brands,

SG Earnings (DBS, Cap Ascendas REIT)

Blog 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.

Markets searching for technical support

Thoughts on Week Ahead: Week 21 Aug 2023 Markets searching for technical support US FOMC minutes have confirmed market’s fear of a hawkish US FED. This fear has triggered a continued sell-off in global equities over the past week. China economy and policy did not help too much either. China Evergrande filed for chapter 11 in US while Country Garden future remain uncertain as investors continue to keep an eye for a more aggressive policy from Beijing to support the economy and people’s confidence. From a technical perspective, markets are searching for technical support levels, where bargain hunters are willing to come in. Support levels are 4,300 for S&P 500 and 3,130 for STI. For the week ahead, market participants will be zooming in on US FED Chair Powell’s speech at the Jackson Hole meeting. We did not uncover trading (tactical) set up for the week ahead and will update once we identify any. Have a great trading week ahead. Headlines for Week Ahead: Key corp earnings (Nvidia

Thoughts on Week Ahead: Week 28 Aug 2023 Looking out for technical reversal indication Past week was an eventful one, with significant developments ranging from the arrest of former US President Donald Trump to BRICS expanding its membership to include financial powerhouses Saudi Arabia and the UAE. However, the focal point for the financial markets remained the speech by the US Federal Reserve Chair at Jackson Hole. The Chair highlighted that current economic condition is more favorable and hinted at holding rates during the Sept FOMC meeting, but also suggested a possible 25 basis points hike later in 2023, aligning with market expectations. Personal view, mixed rate outlook could suggest potential interest rate pivot (peak). Currently, both the S&P 500 and Hang Seng Index are in the process of establishing support levels at 4,300 and 17,800, respectively. We are closely monitoring these markets for signs of supply exhaustion, which would indicate a potential reversal. Intuit

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