Stocks down trending, trading at key support

Thoughts on Week Ahead:

Week 30 Oct 2023

Although the US 3Q23 GDP report improved and earnings were satisfactory, the stock markets experienced a decline. Notably, major banks are raising funds despite strong earnings, highlighting the need for caution.

At present, the S&P 500 is hovering within the 4,080-4,150 range, a crucial support zone. It is essential to monitor any indications of increased demand, as this level could present an opportunity for short-term trading. However, if there is a lack of buyer activity, there is a risk of the index experiencing further decline. A breakthrough above the downtrend line (Blue) would indicate a positive technical outlook.

The spot gold price has surpassed the US$2,000/oz mark due to geopolitical concerns. Gold could to trade towards US$2,400, provided that price remains above US$1,900.

Looking ahead to the upcoming week, the US FOMC announcement has the potential to trigger significant movements in the stock markets once again. Our focus will be on identifying trading opportunities in the gold sector and swing trades for stocks exhibiting resilience at key support levels.

News Links:

https://www.forbes.com/sites/bill_stone/2023/10/29/stocks-fall-despite-better-earnings-and-gdp-growth/?sh=4fa4217b1a4c

https://www.bloomberg.com/news/articles/2023-07-17/wall-street-banks-kick-off-high-grade-bond-sales-post-earnings?sref=HeOgpUGN

Headlines for Week Ahead:

US Corp Earnings (AAPL, AMD, MCD, QCOM, Foxconn, CAT, AIG, SBUX, BOC)

SG Corp Earnings (Great Eastern)

US FOMC, Non-Farm Payroll, ISM Mfg & Non-mfg

China Oct PMI

SG PMI, 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.

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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