Weekly Market Outlook

Thoughts on Week Ahead:

Week 29 April 2024

Google entered the prestigious 2T club on Friday following its earnings announcement, contributing to the momentum of the stock market rally. The exclusive group of companies valued at over $2 trillion now includes Apple, Microsoft, Google, and Nvidia. A lighthearted suggestion for this elite group could be the "Fantastic 4," and perhaps humorously dubbed "MANGO" if Oracle could join the ranks.

From a technical standpoint, the S&P 500 found support at the 4,950 level, indicating expectations for the index to trade within a range of 4,950 to 5,260.

The upcoming US Federal Open Market Committee (FOMC) announcement next week garners significant attention, particularly regarding adjustments to inflation forecasts and the outlook for 2024 rate cuts.

A notable development from the past week was the Hang Seng Index (HSI) and China A50 breaking above their respective medium-term downtrend resistance, suggesting a potential bottom for both indices. This could prompt investors to consider adding exposure to the China market in their core portfolios and engaging in more tactical trades within the Greater China markets.

DBS Group (D05) is set to announce earnings on Thursday, which could influence directional movements for Singapore banks and the Straits Times Index.

Headlines for the week:

- US Corp Earnings (Amazon, Eli Lilly, Coca-Cola, McDonald's, Mastercard, Qualcomm, Apple and Booking)

- SG Corp Earnings (DBS, REITs, Wilmar)

- US FED FOMC, Jobs Report

- China PMI, Labour day holiday

- SG PMI, retail Sales, Labour Day

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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