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Tencent major 4.5% drop sending a break in structure Tencent break in uptrend structure - Bearish Tencent has eventually broken below the Uptrend structure after fantastic upside. This means, the price is now in free fall and is more likely to touch the previous support (brim level of the last Cup and Handle ). 21<7 price>200 - Reversal RSI <50 - Bearish Target 312 I just did an analysis on Naspers which we spoke about how Tencent has the correlation. As Naspers correlates with Tencent and Prosus... We saw a sluggish market in Asia session with the banking holiday effect in America. Hong Kong stocks slump as Chinese tech giants step up rivalries, HSBC in focus as market await corporate earnings boost. The Hang Seng Index declined 1.7 per cent to 20,529.49 at the close of Tuesday trading, the biggest drop in over a week. The Tech Index tumbled 3.6 per cent while the Shanghai Composite Index added 0.5 per cent. The benchmark index has lost nearly 5 per cent in the past two weeks as hedge funds withdrew from the market. With Tencent dropping 4.5% this is why we saw a large breakaway gap with Naspers. Caution is needed with such volatility .
HKEX:700Short
by Timonrosso
BABA Alibaba Options Ahead of EarningsIf you haven`t sold BABA when Charlie Munger did: or reentered when it was cheaper than the IPO: Now looking at the BABA Alibaba options chain ahead of earnings , I would buy the $110 strike price Calls with 2023-8-18 expiration date for about $10.20 premium. If the options turn out to be profitable Before the earnings release, I would sell at least 50%. I have chosen that expiration date to allow me to be wrong and not close the position and to have a bigger gain by the expiration date, if BABA Alibaba keeps on climbing. Looking forward to read your opinion about it.
NYSE:BABALong
by TopgOptions
6
EEM: Emerging Market MSCI (EM) : SELLEmerging markets equities had to clear many hurdles in 2022 but began to recover in the fourth quarter. But technically, there are hurdles, The Red sloping line of 2021 is the prime example. After the steep drop in equity markets overall in 2022, It is believed that emerging markets equities may be one of the most mispriced asset classes, with attractive valuations compared with historical levels. A 15% drop cannot be ruled out...fundamentals are strong, but technicals will sadly rule.
AMEX:EEMShort
by SWFguy
China: Back to the Grind (SHORT)China: Morgan Stanley scenario: Chinese stock indexes could plunge by another 20% from current levels over the next six to 12 months — and potentially remain lower for much longer if the hypothetical stress scenario persists. China’s GDP could slow drastically, averaging 2% growth in 2023. More than 11 million people could lose their jobs, likely sending the urban unemployment rate above 7%. Construction, accommodation and catering would see the most job cuts.
SSE:000062Short
by SWFguy
Buying CN50 at trend of higher lows.CHN50 - 24h expiry - We look to Buy at 13540 (stop at 13470) Although the bears are in control, the stalling negative momentum indicates a turnaround is possible. The trend of higher lows is located at 13455. This is positive for short term sentiment and we look to set longs at good risk/reward levels for a further correction higher. The hourly chart technicals suggests further downside before the uptrend returns. We look to buy dips. Our profit targets will be 13740 and 14235 Resistance: 14235 / 15080 / 16150 Support: 13110 / 12645 / 12070 Please be advised that the information presented on TradingView is provided to Vantage (‘Vantage Global Limited’, ‘we’) by a third-party provider (‘Signal Centre’). Please be reminded that you are solely responsible for the trading decisions on your account. There is a very high degree of risk involved in trading. Any information and/or content is intended entirely for research, educational and informational purposes only and does not constitute investment or consultation advice or investment strategy. The information is not tailored to the investment needs of any specific person and therefore does not involve a consideration of any of the investment objectives, financial situation or needs of any viewer that may receive it. Kindly also note that past performance is not a reliable indicator of future results. Actual results may differ materially from those anticipated in forward-looking or past performance statements. We assume no liability as to the accuracy or completeness of any of the information and/or content provided herein and the Company cannot be held responsible for any omission, mistake nor for any loss or damage including without limitation to any loss of profit which may arise from reliance on any information supplied by Signal Centre.
VANTAGE:CHINA50Long
by VantageMarkets
Higher low on USD/CNH hints at countertrend bounceYield differentials between the US and China 2-year treasury note continue to suggest USD/CNH could be oversold, at least over the near-term. The daily close chart (above in black) also better shows the potential for a higher low, as part of a countertrend move. The daily candlestick chart shows a recent pullback has failed to retest the 6.6976 low, and yesterday formed a 2-bar bullish reversal pattern (bullish piercing line). Whilst prices remain within a small retracement channel, we’re now looking for a break higher and minimum move to the highs around 0.6800 (near the monthly pivot point, 100% projection and recent highs). Should it break higher, then the it has the potential to extend to the 138.2% or 161.8% projection levels, the latter of which is by the 200-day EMA. Further out, I doubt Beijing will want their currency to depreciate too much given weak export data, so its possible the anticipated move higher is simply a countertrend move which could later break to new cycle lows.
Short
by CityIndex
1
Wandering Balloon Deflates the Rise of Chinese YuanCME: USD/RMB Futures ( CME:CNH1! ) US-China relations are arguably the most challenging bilateral relations in the 21st century. It has been in a free fall since the 2018 trade conflict. The competition has intensified and spread to investment, technology, among other arenas since then. On November 14th, 2022, President Biden met with President Xi during the G-20 summit in Bali, Indonesia. This was expected to be a turning point to stabilize the relations. Secretary of State Antony Blinken planned a follow-up trip to China, scheduled to depart on February 3rd. However, a massive balloon floating in the skies of Montana causes a diplomatic panic. The US alleges that it is a high-altitude military surveillance balloon from China, while China claims that it is a civilian airship derailed by wind, a force majeure accident. Last Friday, Secretary Blinken announces the postponement of his China trip. The next day, U.S. military shoots down the balloon over the Atlantic Ocean off South Carolina. The drama between Washington and Beijing has significant impacts over the annual $700 billion bilateral trade. Tensions could be a nightmare for tens of thousands of US companies operating in China. Today, we focus on the most prominent market risk of all, USD/CNH, the US dollar – Chinese Yuan exchange rate. The Rise and Fall of USD/CNH In FX spot and futures markets, USD/CNH is quoted as Yuan per Dollar. When the quote of USD/CNH rises, CNH depreciates because each dollar can be exchanged for more yuan. Similarly, a falling quote represents dollar depreciation which in turn is yuan appreciation. How is the USD/CNH exchange rate determined? Interest rate parity (IRP) states that the interest rate differential between two countries is equal to the differential between the forward exchange rate and the spot exchange rate. The formula for IRP is: F0=S0×((1+ ic)/(1+ib)), where: Forward Rate=Spot Rate × ((1+ Country C’s Interest Rate)/(1+ Country B’s Interest Rate) ) The 10-Year US Treasury Yield is currently quoted at 3.623%, higher than the 10-Year Chinese Government Bond Yield of 2.934%. Plug these into the IRP formula with a spot rate of 6.792, we will arrive at a forward rate of 6.837. Examining the 1-year price chart of CME CNH futures, we find that Yuan lost 10,000 points between March and October last year, from 6.3 to 7.3. The trend closely correlates with the Fed rate hikes. This is a vindication of sound economic theory. While China’s central bank exercises control over its currency, in recent years it adopted open market operations and phased out strong-armed government directives. The parallel trends diverged in November, as China ended its 3-year-long Zero-Covid policy. China’s reopening becomes the main driver of USD/CNH, which receded 6,000 points from 7.3 to 6.7 in three months. Yuan’s strengthening has been interrupted last week as the Balloon incident hits the newswire. USD/CNH lost 900 points in two days, currently quoting at 6.792. In my opinion, as the Fed tightening cycle enters the last inning, it no longer has an overarching impact over USD/CNH. Going forward, US-China bilateral relations take over. Bilateral relationship between the countries will remain unpredictable. This is a developing story. Will there be a strong retaliation, or a mulled response? Different actions could swing the Yuan exchange rate from one extreme to the other. Hedging for Currency Exposure Amid Unstable Relations US importers, exporters, and US companies operating in China all face significant risks when the exchange rate is so volatile. Some of the cost may be in one currency, while the revenue is in another. Hedging net currency exposure is key to lock in the profit. US-China trade has been very unstable in the past few years. But overall, a “decoupling” trend has already been under way. In 2017, China was the largest US trading partner. Bilateral trade accounted for 16.9% of all US foreign trade. The most recent data for the first 11 months of 2022 shows a different story now: • Canada is the No. 1 US trading partner with $733.1 billion and a 14.9% share • Mexico is the 2nd largest, with $718.3 billion (14.6%) • China is now only the 3rd largest with $639.5 billion and a 13.0% share The US has become less dependent on China in its global supply chain. This is evident by the huge growth in bilateral trades with Vietnam (+122%), Taiwan (+102%) and India (+89%) in the last five years, while China trade only managed to grow 2%. Short-term Trades May Prevail In “Year of the Rabbit: Short-tailed Trading”, I discussed my preference for short-range trading this year over longer-term holding done in the past year. Market uncertainties pose more challenges in analyzing multiple moving targets with uncharted trajectories. The Chinese currency is exactly what I am talking about. Just when you think China’s reopening would induce a secular bull run, a wandering balloon out of the blue sky deflates that hope. I would not be surprised if we have a repeat of the 2018 Trade Conflict. When the tension between the two superpowers intensifies, it could swing the market wildly. For readers who have followed my stories, once again, we could leverage the game theory and event-driven strategy in response to this unexpected market event. In the past few years, I have deployed game theory and strangle options across a number of highly volatile and uncertain market scenarios, upon US-China Trade Conflict, the Russia-Ukraine Conflict, the Fed Rate Hikes, the US Midterm elections, and the US Debt Ceiling Showdown. Most of these ideas have been published on TradingView. You will find links to these stories at the end of this report. While there isn’t an option contract available on the CNH, short-term trade on the currency futures contract may be considered. Take the balloon incident as an example: Do you think Beijing will retaliate or merely protest in words? The former could worsen the US-China relations, and in my view, push the value of the Yuan down. The latter indicates the conflict can be managed without getting out of control, which is good news for the Yuan. In summary: • Hawkish response – Yuan value Down and CNH futures price Up; • Dovish response – Yuan value Up and CNH quote Down Once you form an educated opinion on which action is more likely, consider placing a long (hawkish) or short (dovish) futures position accordingly. Then hold on for the events to unravel. If history is any guide, the market often tends to over-shoot in response to overreaction. Happy trading. Disclaimers *Trade ideas cited above are for illustration only, as an integral part of a case study to demonstrate the fundamental concepts in risk management under the market scenarios being discussed. They shall not be construed as investment recommendations or advice. Nor are they used to promote any specific products, or services. CME Real-time Market Data help identify trade set-ups and express my market views. If you have futures in your trading portfolio, check out on CME Group data plans in TradingView that suit your trading needs www.tradingview.com
CME:CNH1!Long
by JimHuangChicago
1
CNHJPY - SHORT; This pair is ready to fall off a cliff!Considering China's (ongoing!!) predicament caused by an oncoming, abject, demographic (urban, industrial) collapse, the obvious consequence is a stand-alone Japan's as the region's only remaining super power" ... Making this Short a no-brainer, probably well over a decade and a half. The Long Term Price Target on this pair is: 10! (I.e. a >50% Decline ..., ... provided that there will be still such a thing as a convertible (off-shore) Yuan, further down the road - which, in itself, is very unlikely!)
Short
by Nemo_Confidat
Nowhere to HideEmerging markets have made some terrific gains in the past month, but I would caution with the path ahead. Take a look at the past year's performance of the Hang Seng, KOSPI, IBOVESPA. I've included a chart of the Tadawul, the Saudi stock index, which is significantly weighted in EEM, the emerging market ETF. These are not healthy charts, and rallies provide opportunities for shorting in my opinion. EEM's breakout from its downtrend will be tested as it compresses between the 50 & 150 EMA's. As of right now, it needs to close above $39.20 to invalidate a daily Head & Shoulders pattern.
AMEX:EEMShort
by sdeutsch95
My thoughts for this week 31 January 2023US This week will be a fairly exciting to monitor as Interest Rate announcement and Non-Farm Payroll data will be release. Two heavy hitting news that is very key to understanding further trends in the markets, especially on DXY. Through entire January 2023, DXY is consolidating steadily and holding ground around 101.500 area. Could this week’s high impact news finally get DXY out of consolidation? We shall see. However, we know that Federal Reserve will be raising rates again by 25 basis points, which mainstream news outlets seem to be mentioning. With this data, theoretically, if rates go up, it is bullish for the currency and vice versa. Another thing to consider is that, Japan and China are still dumping US Treasuries/Bonds and many other countries are attempting to de-dollarize. Further add to the fuel is US’s national debt ceiling that has been breached last week. These 2 scenarios are very bad for the US economy. How much of bullishness will 25 basis point increase bring about? So far, from the last two, Federal Fund Rate announcement (Nov & Dec 2022), we see that DXY declined even with 50 basis points hike. Could history repeat again? Perhaps DXY can reclaim 102.500 – 103.000 but I do not think whole-heartedly that it will give 105.000 a go. China With China’s re-opening, there is definitely positivity circling the global markets. China’s GDP growth was reported up by 3% for the year 2022, higher than expected rate of 2.8% but yet still fell short of March’s target of 5.5%. The sign of growth, though little, is still a sign of improvement. Considering after months’ long Zero Covid policy and geopolitical tension with the West, problematic real estate sector, this slight improvement definitely have greater volume to it than just the number. We cannot take our eyes away from the long term end goal of China, which is to be the next reserve currency of the world. Collaboration with some powerful nations e.g. Saudi Arabia, Brazil, South Africa, Indonesia, India etc via BRICS+ bloc, brings Xi Jin Ping’s path to dominance one step closer day by day. Recently, Saudi Arabia also made public about their consideration of non-US Dollar for Oil trade. Gold continues to be horded by China, as well as Russia and major central banks of the world, just goes to prove the level skepticism towards the greenback. Just my thoughts. Trader Sifu Steve @ XeroAcademy Malaysia
TVC:DXY
by XeroAcademy
GSUN | A Great Entry Point | I Bought the DipGolden Sun Education Group Limited, through its subsidiaries, provides education and management services in the People's Republic of China. It operates through two segments, primary and secondary school services, tutoring, and other Services. The company offers private school educational and foreign language tutorials, and other education training management services. The company was founded in 1997 and is headquartered in Shanghai, China.
NASDAQ:GSUNLong
by DivergenceSeeker
7
Google vs Apple; How Android will kill Apple.Fact; - Apple (iPhone, etc.) is entirely (100%) sourced from China; - Google (Android) is 100% sourced from S. Korea & Japan. 1) Considering the abject population collapse - and massive DE-industralization!! - of China, it will take YEARS for Apple to relocate it's entire supply chain. (To N. America?) E.g. Apple will be lucky to bring out a new iPhone every other year - even that being overly optimistic. 2) Barring an outright armed conflict between S. Korea and Japan (very unlikely) Google's supply chain should be just fine, mostly unaffected by the coming Chinese de-urbanization and de-industrialization. (... which China will be forced to endure in order to feed the *** 800 million Chinese ***, which is what will be left in that country, by 2035.) When will this purported Chinese population collapse and total de-industrialization begin?? ... You are in it! (It is well worth to pay attention to it because it will (continue to) be spectacular!!) Simultaneously, the technical picture is also very favorable for the upside, in this spread.
NASDAQ:GOOGLLong
by Nemo_Confidat
2