Expecting volatility to remain as earnings reporting slows

Expecting volatility to remain as earnings reporting slows

Latest earnings reports showed that Meta Platforms, Alphabet, Amazon, and Microsoft all reported strong earnings growth. This is a sign that software companies are able to weather economic storms and continue to generate profits.

On US credit rating downgrade, investors remain split. Some believe that the downgrade is a sign of underlying problems in the US economy, while others believe that it is largely symbolic.

The S&P 500 is facing supply pressure and volatility. Our key support levels for the index are 4,400 and 4,300. We remain alert for bullish trading opportunities, as we take a cautious view on the market overall.

The Chinese market recovery is modest. We continue careful positioning into the Chinese market. The next sector expected to see recovery is the smaller cap growth sector. We believe that ChiNext ETFs such as CXS:SGX could move higher as the economy improves.

Headlines for Week Ahead:

US China Corp earnings (Alibaba, Sands China, PLTR, UPS, DIS, NetEase)

SG Corp earnings (Property Sector, Genting SP, Wilmar, AEM)

US CPI, PPI Reports

China Export and Import Data

China CPI

SG 2Q23 GDP (final)

SG National Day Holiday

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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