Market profit take as US FED is expected to hold rates

 




The US Federal Reserve is expected to keep interest rates unchanged at 5.25%-5.5% at its meeting today. All eyes will also be on the People's Bank of China's loan prime rate decision, following the surprise reserve requirement ratio cut this week.

The S&P 500 continues to trade within a large range of 4,330-4,550, as demand and supply battle for dominance. The FOMC policy speech could be a trigger for a directional move.

We do not have a tactical idea for US market. However, it's worth highlighting that the REITs sector has begun to witness increased activity in recent weeks, driven by expectations of a pause in interest rate hikes. Capitaland India Trust (C6YU:SGX), in particular, has broken out of its previous downtrend, suggesting the possibility of entering an accumulation phase before a potential uptrend.

*Headlines for Week Ahead:*
US FOMC Meeting
US S&P Global PMI
China LPR fixing
SG Aug NODX

Popular posts from this blog

Eventful Week: FOMC Decision and Earnings Reports Headline Upcoming Week

Image
  Eventful Week: FOMC Decision and Earnings Reports Headline Upcoming Week The week ahead is shaping up to be a busy one for the markets, with the Federal Open Market Committee (FOMC) meeting and earnings season taking center stage. The FOMC is widely expected to raise interest rates by 25 basis points on Wednesday, in an effort to combat inflation. This will be the first rate hike after June's pause, and investors will be closely watching the accompanying statement for any clues about the pace of future rate hikes. Earnings season is also in full swing, with more than 100 companies in the S&P 500 scheduled to report results this week. Investors will be looking for signs of how companies are weathering the current economic and geopolitical challenges. In the meantime, China markets appear to be stabilizing, with the yuan holding steady against the dollar below 7.25 and KweiChow Moutai (600519), a vital component of the China A50 index, which displays strength by breaking out
Read more

Wyckoff's Law of Effort

Image
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.
Read more