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A Traders’ Playbook – the week that has everythingWe move past a busy week in markets and onto an even busier one, littered with potential landmines for traders to navigate. One key theme which has legs this week are moves in Chinese markets – notably, China went after short sellers with several targeted measures. We also saw a 50bp cut to banks RRR amid reports of an RMB2t package for offshore SOE to buy Chinese equities – that said, with big inflows into mainland funds, the HK50 and CSI 300 managed an unimpressive 4.2% and 2% weekly gain respectively. Judging by price action in the HK50 market players seem unsure about building on the move from 15k, and Fridays inside bar needs to be rectified – I would look to trade a break of 16300 (longs) and 15809 (shorts) While hindsight is a wonderful thing, the equity index to be long on the week was the EU Stoxx 50, which is in beast mode (even when priced in USD). The ECB refraining from pushing back on market pricing has certainly helped, while EU earnings also ramp up. Looking ahead, Thursdays EU CPI could be very important for both the EUR and EU equity, where a weak core CPI print – below 3% - could open the door for the ECB to signal a big change from the collective at the 7 March ECB meeting, although we can gauge an immediate response to the CPI data from ECB members Lane and Centeno, who both speak after the CPI data. US data last week, for the most part, impressed and should result in the FOMC statement being little changed this week. Nuance and positioning will play a key role in the moves in rates, the USD, gold, and equity. FOMC aside, it’s a big week ahead State Side, with a raft of key labour market reads, growth data points, the US Treasury Quarterly Refunding Announcement (QRA) as well as it being the marquee week of US earnings with Microsoft, Apple, Alphabet and Amazon reporting. It’s not a shock that longs in NAS100 and US500 have had a collective rethink and thought twice about building on the move into 4900. That said, if we look at the volatility markets there has been no pickup in hedging activity with limited propensity to buy downside puts. In fact, all the talk has been that funds are selling index calls to collect premiums and enhance returns on their underlying equity positions. This is subsequently having a big effect in dampening volatility. Crude and Nat Gas are where the moves are taking place, and certainly, SpotCrude had a flyer gaining over 6% on the week, trading into the Nov range highs and taking out the 200-day MA. US data has been a factor, but geopolitics is also a growing issue, and we watch headlines roll in. The bulls seem to have control for now, so upside risks remain – a break higher could also become problematic for future headline inflation, although we’re not at levels too concerning yet. All in, we see a new week littered with key event risks – economic data flow, central bank meetings and corporate earnings. It pays to be aware of the calendar, whether one is day trading and navigating these potential vol events through the day. Or holding positions but not in front of the screens. Consider if the event holds the potential for outsized moves, where the skew of risk resides, and what the means for the stop placement and position sizing. It’s the week that has it all – good luck. The marquee event risks for traders to navigate this week: • End-of-month portfolio flows – Investment bank flow models suggest USD selling to play out to rebalance portfolios, with some sizeable selling in Japanese equities to reweight. • Aus Q4 CPI (31 Jan – 11:30 AEDT) – Q4 CPI poses an obvious risk to AUD and AUS200 exposures. The market looks for headline Q4 CPI to print 0.8% QoQ / 4.3% YoY (from 5.4%), with the trimmed mean measure also expected to fall to 4.3% YoY. Importantly, the RBA had forecast 4.5% for Dec CPI (on both metrics), so the further below that the more dovish the reaction in the AUD. As it stands, Aussie interest rate futures see no chance at the Feb RBA meeting, with a 1-in-4 chance of a 25bp cut in the May meeting. Given such sanguine pricing, we’d need to see a 3-handle on CPI YoY to bring a cut onto the table near-term and promote a big move in the AUD. • China Manufacturing and Services PMI (31 Jan – 12:30 AEDT) – the market eyes the manufacturing index at 49.2 (from 49.0) and the services index at 50.6 (50.4) – after some big stimulus last week CN/HK equity index longs will be keenly hoping for the data flow to show signs of improvement, although it’s the property space that is of most interest. • FOMC meeting (1 Feb 06:00 AEDT) & Chair Powell presser (06:30 AEDT) – it will certainly be hard to match the strong dovish reaction in the Dec FOMC meeting and after the strong Q4 GDP print, and consumption the Fed will be in no mood to declare victory. With the Fed expected to lose its tightening bias, the FOMC statement should read neutral. There will also be a large focus on the timeline for tapering the pace of QT (or balance sheet reduction), notably with Jay Powell’s likely to be heavily probed on this in his press conference – all up, while positioning is always a factor, I see two-way risks for the USD and equity. See our preview here - pepperstone.com • Sweden’s Riksbank meeting – the Riksbank will leave rates at 4% but should open the door to cuts, with the swaps market pricing the first cut in May. Preference for USDSEK upside, adding on a closing break of 10.5000. • BoE meeting (1 Feb – 23:00 AEDT) – the GBP has found support from resilient UK data flow, with GBPUSD tracking a clean 1.2800 – 1.2600 range. The market will be expecting the bank to retain a hawkish lean and will be looking for changes in the vote split to a 8-1 or even 9-0 vote to hold rates. With the market pricing the first 25bp cut at the May BoE meeting at 50%, and the first cut fully priced in June, I see a two-way risk to the GBP at this meeting. See our preview here - pepperstone.com • US nonfarm payrolls (3 Feb – 00:30 AEDT) – the median estimate is that we see 180k jobs created (the economist range of estimates is set between 285k to 120k), with the unemployment rate expected to tick higher to 3.8%. I think the USD reaction will be more closely linked to the outcome of the U/E rate than net job creation. • EU CPI (1 Feb) – The CPI print could be pivotal to the ECB and could set the stage for a more dovish narrative from the bank. The market sees headline CPI falling to 2.7% (from 2.9%) and core CPI to 3.2% (3.4%). Chief economist Lane speaks 90 minutes after, so we could get an immediate reaction to the data from one of the ECB’s most influential members. The EU CPI print poses big EUR risk given the implication for ECB rate expectations, so consider EUR exposures over the news. • US Treasury financing estimate (29 Jan) and Treasury Quarterly Refunding Announcement (QRA - 31 Jan) – the QRA was the trigger for lasting trending conditions in price in both August and November and the implications this time around could be significant. That said, I am leaning towards the idea that the market will not get a surprise this time around, but with T-bills still expected to play a big role in govt funding in the weeks ahead there will be further increased scrutiny on the level of RRP balances and ultimately the funding markets (SOFR-Fed funds). See our preview here - pepperstone.com US earnings in the week ahead – As it stands, we’ve seen 25% of S&P500 companies report, 78% have beaten expectations on EPS (by an average of 6%) and 53% have beaten on sales. Companies have reported 1.6% aggregate EPS decline, and 3.7% sales growth. In the week ahead we get earnings from just over 40% of the S&P500 market cap, including 4 of the illustrious MAG7 names – as a highlight I expect good interest in: Tuesday - UPS, Microsoft (implied move -/+ on the day of reporting 4.3%), Alphabet (-/+ 5%) Wednesday - Boeing (-/+ 3.8%), Mastercard (-/+ 2.9%), QUALCOMM (-/+ 5.6%) Thursday - Apple (-/+ 3.2%), Meta (-/+ 6.5%), Amazon (-/+ 6.2%) Friday - Chevron (-/+ 2.3%), and Exxon (-/+ 2.2%). Other US data points worth considering: US – Consumer confidence (31 Jan 02:00 AEDT), JOLTS jobs openings (31 Jan 02:00 AEDT), Employment Cost Index (1 Feb 01:00 AEDT), ISM manufacturing (2 Feb 02:00 AEDT). In LATAM FX: The BCCh (Chile) meet on Wednesday and are expected to ease by 100bp to 7.25%, although there is a chance they go 75bp - USDCLP is seeing positive momentum and I favour it higher near-term but have limited conviction. The Brazilian CB go on the same day and should cut the selic rate by 50bp to 11.25% Columbia also meet on Wednesday, and we see a 50bp cut to 12.50%.
PEPPERSTONE:US500
by Pepperstone
A beginner's analysis in HK50 Short TermTraders may consider trading the HK50 (Hang Seng Index) in the long (buy) direction for several reasons: Bullish Market Sentiment: If there is a prevailing bullish sentiment in the global or regional economy, it can positively impact the HK50. A long position aligns with the expectation that the index will rise, potentially resulting in profits. Strong Fundamentals: A trader may observe strong economic indicators, robust corporate earnings, or favorable government policies in Hong Kong, which can support a long trade as these factors are likely to drive the index upward. Diversification: Incorporating the HK50 into a diversified investment portfolio can provide exposure to a different market and currency, reducing risk through diversification. Technical Analysis Signals: Traders may use technical analysis to identify patterns, support levels, or other indicators that suggest the index is likely to move higher, providing a basis for long trades. Global Events: Positive outcomes in international events or trade agreements can benefit the Hong Kong market and may encourage traders to take long positions. Risk Management: Before trading long, traders should set stop-loss orders and risk management strategies to limit potential losses. A well-defined risk management plan is crucial in any trade. Research and Analysis: It's essential to conduct thorough research and analysis, taking into account various factors, before entering a long trade. This includes monitoring news, earnings reports, and geopolitical events. Traders should be cautious and consider market conditions, personal risk tolerance, and their own analysis when deciding whether to trade the HK50 or any other financial instrument. Trading in the financial markets carries inherent risks, and decisions should be made with care and diligence.
CAPITALCOM:HK50Long
by IMODERAT0RI
RBA meeting playbook – a 25bp hike is the call Having been on hold since June the RBA should hike by 25bp to get the cash rate to 4.35%. We see a 60% chance of a hike priced into interest rate futures, with the market having a high conviction that if they don’t hike next week then they will almost certainly in December. 21 of 24 economists (surveyed by Bloomberg) are calling for the hike. The doves do have a case for the RBA keeping rates on hold, but the case to hike seems stronger., with Aussie economic data consistently beating expectations since early October. This should culminate in the RBA increasing its inflation forecasts for Dec-23 and June-24 by 25bp, with its trimmed mean CPI estimate likely revised higher by around 50bp. Given Q2 GDP came in 50bp above the RBA’s forecasts we should see its growth measures increase as well. One can argue that leaving rates on hold would risk the bank being seen as getting behind the inflation curve, and we can see market pricing of 5-year inflation expectations rising to 2.81% - approaching the highest levels since 2011. Some have also focused on Treasurer Jim Chalmers recent comments that the Q3 CPI print did not represent a “material” worsening in the inflation outlook, and by leaving rates on hold it could be seen as a sign of reduced central bank independence. The RBA to review the stress on households We can look ahead to the upcoming bank earnings reports with WBC (6 Nov), NAB (9 Nov) and ANZ (13 Nov) and review their asset quality given lending rates have increased so rapidly. In the prior trading updates, there was no clear evidence that borrowers were facing broad difficulties. In fact, projections that total scheduled P&I payments will push to 9.75% of household disposable income in 2024, suggest servicing this debt is still manageable. We also see over 40% of households are ahead on mortgage payments and have enough savings to cushion a further increase. In terms of volumes, APRA’s September lending data showed total gross loans and advances grew 0.7% m/m in September, with household lending growth +0.3% m/m and business growth +1.2% m/m. Credit card volumes increased 1.2%. And with house prices still on the rise, these are factors that will lean the RBA towards a hike. The RBA will be cognisant of the impact a further lift in the cash rate will have on households and businesses – but while some will be negatively impacted and undergo real stress, on the whole borrowers should be able to readily absorb more hikes. Trading the RBA meeting Given market expectations and pricing, should the RBA leave rates on hold but retain a hawkish bias, then we should see the AUDUSD drop 50 pips or so off the bat, with a solid rally likely seen in the AUS200. With the base case being we see a 25bp hike while maintaining a tightening bias, then all things being equal the AUD should find good buyers, with AUDUSD spiking 30-40 pips. AUDNZD has been the most sensitive to interest rate differentials, as we see here in the AUS-NZ 2-year forward rate differentials. If the RBA hike and imply more then AUDNZD should break the recent highs of 1.0940. In fact, on a simple rates model the AUDNZD cross should be trading closer to 1.1050. AUDUSD is more of a risk proxy than a rates play, taking direction from S&P500 futures and the HK50 index, but the setup is looking more compelling for longs. I prefer to play this from a momentum standpoint and wait for the close above 0.6445, for a potential move into 0.6600. EURAUD, AUDCHF and AUDJPY are also risk proxies and have a good relationship with the VIX index. Granted, if the RBA hikes, then we will likely see a pop in the AUD, but after a short period traders will revert to taking its direction from S&P500 futures and cross-asset volatility. Looking at AUD 1-week implied (option) volatility (vol) we see vols are not showing any real signs option market makers are expecting a significant change in the trading conditions next week. That said, given the split pricing for Tuesday, we could see some rapid-fire moves around the announcement and that is a risk traders need to manage.
Long
by Pepperstone
𓃑 Here is a technical analysis update about the Chart HK50The HK50 index has been on a downward trend for the past 7 days, but today we witnessed a significant rebound, marking a potential shift in its trajectory. As a trading professional, I will provide you with a detailed technical analysis update on the HK50 chart. Technically, the index has successfully surpassed the resistance level at 17,138 on the hourly chart. This breakthrough indicates a potential shift in market sentiment and suggests the possibility of further upward movement. The current nearest resistance level stands at 17,409, which will be crucial to monitor in the coming days. To gain a clearer perspective, we need to observe the market for another one to two days. If the HK50 manages to stabilize above the 17,138 level, it could signal a temporary bottoming out or the emergence of a short-term upward trend. Traders should closely monitor the price action during this period and take advantage of potential trading opportunities. In the event that an upward trend materializes, the index will face a significant challenge at the resistance level of 17,925. This level has proven to be a key obstacle in the past and will require careful analysis and strategic decision-making. Additionally, it is worth noting that the Fibonacci 50% retracement level corresponds to 17,590. This level often holds significance in technical analysis and can provide further insights into potential price movements. In conclusion, the recent rebound in the HK50 index after a series of declines and a prolonged holiday period has sparked interest among traders. The technical analysis suggests the possibility of a shift in market sentiment, with potential short-term upward movement. However, further observation and analysis are required to confirm this hypothesis. Traders should remain vigilant and adapt their strategies accordingly to capitalize on potential trading opportunities.
PEPPERSTONE:HK50Long
by ICT_Trader_SB
AUDUSD - a slave to Chinese markets We saw a lot of confusion in the headlines as to the weakness in AUDUSD yesterday. The RBA meeting had very little to do with it, and the AUD has just been a proxy of Chinese markets. A higher USDCNH and weaker HK50 saw AUD lower, and a simple overlap will highlight this. Weaker China Caixin services PMI data was behind this, so as we look ahead at China trade data (tomorrow – no set time), international funds continue to use the AUD as a liquid and cost-effective vehicle for trading the yuan. After a big move lower on the session yesterday, we are seeing modest follow-through selling in AUDUSD today – not influenced by Aus Q2 GDP (which was modestly hotter), but USDCNH pushing higher. Favour this pair further lower, although if China property stocks do reverse higher here, I’d reverse as a day trade and follow the tape.
Short
by Pepperstone
1
HKEX bias is still for lower levels.HS50 - 24h expiry - We look to Sell at 18100 (stop at 18300) Although the bears are in control, the stalling negative momentum indicates a turnaround is possible. A higher correction is expected. The bias is still for lower levels and we look for any gains to be limited. We therefore, prefer to fade into the rally with a tight stop in anticipation of a move back lower. Further downside is expected although we prefer to sell into rallies close to the 18100 level. Our profit targets will be 17600 and 17510 Resistance: 18015 / 18520 / 18915 Support: 17375 / 17040 / 16560 Please be advised that the information presented on TradingView is provided to Vantage (‘Vantage Global Limited’, ‘we’) by a third-party provider (‘Everest Fortune Group’). 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 Everest Fortune Group
VANTAGE:HK50Short
by VantageMarkets
Selling HK50 at previous resistance.HS50 - 24h expiry - We look to Sell at 19213 (stop at 19373) We look to trade the current range. Trading has been mixed and volatile. Bespoke resistance is located at 19200. Preferred trade is to sell into rallies. The primary trend remains bearish. Our profit targets will be 18813 and 18733 Please be advised that the information presented on TradingView is provided to Vantage (‘Vantage Global Limited’, ‘we’) by a third-party provider (‘Everest Fortune Group’). 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 Everest Fortune Group. Resistance: 19000 / 19200 / 19350 Support: 18800 / 18700 / 18600
VANTAGE:HK50Short
by VantageMarkets
HKEX to find buyers at neckline support?HS50 - 24h expiry - We look to Buy at 19220 (stop at 19060) We are trading at overbought extremes. A lower correction is expected. Posted a Double Bottom formation. Neckline support is 19217. Further upside is expected although we prefer to set longs at our bespoke support levels at 19220, resulting in improved risk/reward. Our profit targets will be 19620 and 19680 Resistance: 19840 / 20400 / 20965 Support: 19140 / 18015 / 17710 Please be advised that the information presented on TradingView is provided to Vantage (‘Vantage Global Limited’, ‘we’) by a third-party provider (‘Everest Fortune Group’). 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 Everest Fortune Group.
VANTAGE:HK50Long
by VantageMarkets
HKEX to stall at recent high?HS50 - 24h expiry - We look to Sell at 19220 (stop at 19405) Price action looks to be forming a top. The 200 day moving average should provide resistance at 19235. This is negative for sentiment and the downtrend has potential to return. Preferred trade is to sell into rallies. Further downside is expected although we prefer to sell into rallies close to the 19220 level. Our profit targets will be 18770 and 18670 Resistance: 19840 / 20400 / 20965 Support: 18015 / 17710 / 16320 Please be advised that the information presented on TradingView is provided to Vantage (‘Vantage Global Limited’, ‘we’) by a third-party provider (‘Everest Fortune Group’). 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 Everest Fortune Group.
VANTAGE:HK50Short
by VantageMarkets
A trader’s week ahead playbook: playing defence into quarter-endAfter a dramatic weekend in geopolitical news flow, we revert to areas more closely aligned with our expertise; the ebbs and flow of economic growth dynamic, inflation, central bank liquidity and month-/quarter-end flows. To set a platform for the week ahead – The USD rallied on 4 of the past 5 days (gaining 0.6%), while it was a rolling sea of red in our core equity indices last week - the HK50 (-4.7%) and GER40 (-3.2%) faring worst on a weekly percentage basis. US equity indices are grinding lower into quarter-end, but it’s the US small-cap plays that need to be on the radar with the US2000 the weakest index – US regional banks once again in the spotlight and finding sellers easy to come by, and the KRE ETF now targets $36.00. Banks take a central focus US Treasury Sectary Yellen’s comments that she expects further consolidation within the banks, while the higher cost of deposits is impacting bank profitability have put these institutions back on traders’ radar - we subsequently mark the Q2 US earning calendar on the map once again when JPM kick off proceedings on 14 July. We can cast our net outside of the US and see banks on a global basis remain key shorting candidates. Notably in the UK and Australia, where Lloyds and NatWest are in freefall, and many are questioning the asset quality and lofty ROE guidance of these institutions amid the unfolding UK mortgage and rental crisis. For AUS200 traders, BoQ and ANZ look particularly vulnerable to further downside, although, tactically, I would consider long CBA/short ANZ as a pairs trade. Will the GBP be impacted by reduced growth expectations? With UK banks in focus, on the data side, there will be focus on the Nationwide house price data (-4% YoY decline expected) and mortgage approvals (+49k in May) this coming week – the market has priced another 50bp hike from the BoE on 3 August, with a peak bank rate of 6.2% by February 2024. However, despite calls that the GBP should now face headwinds as the currency morphs from carry to a relative growth play, we’re not seeing that play out in the price action. Granted, the UK gilt curve has collapsed but GBPAUD, GBPNOK and GBPNZD all look like they’ve got further upside here. I’d be looking for GBPUSD to test 1.2680, where this could run into buyers here. In the US we’re seeing signs of reduced system liquidity with bank reserves falling $102b last week and starting to do more of the heavy lifting in supporting the massive US Treasury TGA rebuild. We get further significant US T-bill and bond issuance this week, and we should see an increased decline in the Fed’s US Treasury holdings, but with rebalancing flows a key factor let's see if this issuance has any impact on risk assets. US data to navigate The US economic data is mostly tier 2 releases – durable goods, regional manufacturing, new home sales and consumer confidence. Core PCE is the highlight (due Friday at 22:30 AEST) and the market sees an unchanged read at 4.7% - again, this could affect pricing for the 26 July FOMC meeting, where the market prices 18bp of hikes here. The USD has found signs of form with the DXY pushing 103. The USD bid a function of falling growth momentum in China and Europe, so the US data points, EU consumer confidence and inflation, and China’s manufacturing/services PMI data (Friday 11:30 AEST) need close attention. It seems the market just can't get enthused by China’s current range of stimulus measures and we see USDCNH another FX cross-rate that has become a trend-followers dream and trades north of 7.2100 – let's see if the PBoC start to push back on the move this week (through its daily CNY fix), as higher levels should accelerate USD buying vs the AUD and the EUR. Staying long USDJPY, for now USDJPY remains well traded by clients, and eyes a move into 144.00 and as we posted last week is coming ever closer to potential jawboning from the BoJ/MoF (pepperstone.com) – traders have pointed to the elevated RSI’s, however, this is not a major concern for me, as it’s the rate of change that the MoF look at more closely. We also see the price at a 4.3% premium to the 50-day MA which is not wholly extended, and where a 5%-7% premium (to the 50-day MA) would be where I’d have a higher conviction of mean reversion trades playing out. Aussie CPI to influence the July RBA pricing In Australia we get monthly CPI and retail sales this week – the market prices a 40% chance of the RBA hiking by 25bp on 4 July, so this data could easily influence that pricing. There will be a concerted groan from households if we see CPI (due Wed at 11:30 AEST) fail to come down to the consensus call of 6.1% (from 6.8%). If we look at the economist’s range of estimates we see the distribution ranging from 6.9% to 5.6%, which is incredibly well dispersed. A 5-handle should see hikes priced out of the July RBA meeting and see the AUD under pressure. On the central bank speeches, there will be focus placed on the Sintra Conference where Powell, Lagarde, Ueda and Bailley will be speaking. The case for gold upside Commodities get a close look too – my preference for gold is to place sell-stop orders below $1912, with the aim to play bearish momentum into and below the figure. Gold bulls will want a close back above $1938, and if the growth concerns that we saw late last week extend into the new week, then gold should benefit as a hedge, but we’d also need to see inflationary pressure ease. Crude found buyers into the range lows of $67.00 – huge support and one that should be on all radars, especially those who want to scalp off big levels.
PEPPERSTONE:USDX
by Pepperstone
HKEX to find buyers at previous resistance?HS50 - 24h expiry - We look to Buy at 19450 (stop at 19250) We are trading at overbought extremes. A lower correction is expected. Short term bias has turned positive. We therefore, prefer to fade into the dip with a tight stop in anticipation of a move back higher. Further upside is expected although we prefer to buy into dips close to the 19430 level. Our profit targets will be 19950 and 20000 Resistance: 20400 / 20965 / 21770 Support: 19140 / 18015 / 16325
VANTAGE:HK50Long
by VantageMarkets
HK50 to stall at current swing high?HS50 - 24h expiry - We look to Sell at 19469 (stop at 19619) Although the bulls are in control, the stalling positive momentum indicates a turnaround is possible. Price action looks to be forming a top. The 200 day moving average should provide resistance at 19458. This is negative for short term sentiment and we look to set shorts at good risk/reward levels for a further correction lower. Further downside is expected although we prefer to sell into rallies close to the 19485 level. Our profit targets will be 19069 and 19009 Resistance: 19650 / 20850 / 22790 Support: 18680 / 17710 / 16320 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:HK50Short
by VantageMarkets
A Traders’ Playbook: China stimulus expectations lift sentimentLooking at the calendar for the week ahead and it’s a quiet affair by way of known event risks to catalyse. We have tier 1 idiosyncratic event risks, with the RBA and BoC meetings holding the potential for a 25bp hike respectively. However, I’d expect the central focus to remain on the USD, US rates pricing, US regional banks and whether we see a further positive flow into the HK50, CHINAH and CN50. Talk of fiscal support from the Chinese authorities have been making waves and on Friday it’s no surprise that we saw $3.18b net buying into China’s mainland equity markets, amid a 4% rally in the Chinese/HK equity indices – this supported EU and US equity sentiment, copper and the AUD found a better bid (notably vs the EUR and CHF). After a nirvana US nonfarm payrolls report (a strong level of job creation, amid softer wages and a higher unemployment rate) we now head into the Fed’s blackout period, with the market favourable to the Fed leaving rates unchanged next week but signalling a strong bias to hike again. Next week’s US CPI print could alter the consensus view of a Fed ‘skip’, but with the core of the Fed leaning to a pause – for now, this is supporting risk and we roll into the new week with the bulls on top. Digging further into the equity move and breadth was solid on Friday with 92% of stocks closing higher, led by materials, industrial and energy, but the chase is on – FOMU (Fear of Meaningfully Underperforming) is a factor, few want to sell, portfolio hedges are being unwound rapidly and it was momentum frenzy, with the 0DTE crowd have a large hand in this chase higher. There is a heightened focus on the US Treasury Department starting to tap the market to rebuild its low cash balances – we get 3 sizeable US T-bill sales this week equating to $173b, so the eyes of the market will be whether this is supported by bank reserves or RRP balances. Again, US banks will be keenly watched (put the KRE ETF on the radar), because if bank reserves prove to be the larger support of T-bill issuance it may start to weigh on sentiment here. Finally, crude saw a 2.6% rally on Friday, largely due to a solid rally in China’s markets. Some would have been covering shorts ahead of the weekend OPEC meeting. However, those running longs would be heartened at the news the Saudis will reduce output by an additional 1m bpd. The news flow on potential China stimulus and the tape in its equity markets will continue to dictate how crude trades - but clearly, the Saudis want a crude price above $80 and a steeper backwardation in the futures curve. Keep an eye on the CAD, and NOK as tradeable crude proxies. Marquee event risk for the week ahead RBA meeting (Tues 14:30 AEST) – We could be looking at a lively RBA meeting with the market pricing a 50% chance of a hike. There is greater conviction from economists with 17 of 25 economists (surveyed by Bloomberg) calling for a pause. Market positioning is mixed, with asset managers running a sizeable AUD short position, while fast-money leveraged funds are progressively long of AUD. RBA action will likely have a short-lived impact on the AUD before it reverts to a tradeable proxy of China data and moves in the HK50 and CHINAH. Bank of Canada (BoC) meeting (8 June 00:00 AEST) – BoC meetings here have been predictable affairs of late, but there is some uncertainty at this meeting – it’s a risk event to consider for CAD traders. The interest rate markets price a 44% chance of a 25bp hike, although the economist community are far more certain with only 6 of 31 (surveyed by Bloomberg) calling for the hike. Into the meeting, the risk for the CAD seems skewed to the downside, where the BoC likely hold and guide to a hike in July conditional on a hot employment report. China trade balance (Wed - no set time) – the market looks for a further lift in the trade surplus to $94.15b. To get to this increase surplus exports are expected to decline by 2%, while imports are expected to decline by 8%. A key data point given the impact China is having on market sentiment, but this is so incredibly hard to forecast, that the market is conditioned to be shocked. China CPI/PPI inflation (Friday 11:30 AEST) – The market expects CPI to come in at 0.2% YoY and PPI at -4.2% YoY. With elevated expectations of imminent policy easing from the PBoC, we’d need to see a blowout upside print to reduce expected policy easing calls. Bad news (i.e. lower inflation) should only further increase policy-easing expectations and prove to be good news for the HK50 and the AUD. China new yuan loans (no set time) - the market looks for new loans to increase to RMB1570b (from RMB718b). With calls for renewed economic stimulus, I expect credit data to start reflecting this going forward to rise from here. I don’t expect the May credit data to move markets too intently unless it’s a substantial beat/miss. US ISM services (Tues 00:00 AEST) – the market looks for the diffusion index to rise to 52.4 (from 51.9). In a quiet week of US economic data, the services ISM report has the potential to influence market sentiment. However, after both Fed chair Powell and VC Jefferson recently leaning towards a pause (or a skip), it’s hard to see this moving rate expectations for the June FOMC meeting too intently. The US CPI print (due 13 June) is the likely decider on whether the Fed pause or hike. Canada May employment report (Tues 22:30 AEST) – the market expects 25k net new jobs to have been created in May, with the unemployment rate eyed at 5.1% (from 5%). The form guide suggests a higher probability of a beat, with the last 8 employment reports coming in above expectations. Momentum in USDCAD is lower and we see good support into 1.3330. Rates Review – we look at market pricing of interest rate expectations and the cumulative number of hikes/cuts (in basis points) for each upcoming meeting. For example, we see 10bp of hikes (a 40% chance of a hike) priced for the June FOMC meeting, but 9bp of cuts to have been implemented by December. Central bank speakers to navigate: Fed speakers – the Fed are in a blackout period until the FOMC meeting (14 June), so we can breathe a little easier. ECB speakers – we hear from Lagarde, Nagel, Guindos, Panetta, Guindos, De Cos, Centeno – EU rates markets price 24bp of hikes for the 15 June ECB meeting, and a peak rate of 3.66% by October. RBA speakers – RBA gov Phil Lowe speaks the day after the RBA meeting (Wed 09:20 AEST). RBA deputy gov Michele Bullock speaks shortly after (Wed 09:50 AEST)
PEPPERSTONE:US500
by Pepperstone
HKEX to find resistance at psychological level?HS50 - 24h expiry - We look to Sell at 19995 (stop at 20155) Although the bulls are in control, the stalling positive momentum indicates a turnaround is possible. The Ichimoku cloud and 200-day moving average provide further resistance and we look to set shorts in early trade to capture this selling opportunity. The weekly pivot is at 20000. The hourly chart technicals suggests further upside before the downtrend returns. We therefore, prefer to fade into the rally with a tight stop in anticipation of a move back lower. Our profit targets will be 19605 and 19525 Resistance: 20850 / 22790 / 24770 Support: 18680 / 17710 / 16330 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:HK50Short
by VantageMarkets
HKEX to stall at current high?HS50 - 24h expiry - We look to Sell at 20305 (stop at 20425) We are trading at overbought extremes. A Doji style candle has been posted from the high. This is negative for short term sentiment and we look to set shorts at good risk/reward levels for a further correction lower. Further downside is expected although we prefer to sell into rallies close to the 20305 level. Although the anticipated move lower is corrective, it does offer ample risk/reward today. Our profit targets will be 20005 and 19650 Resistance: 20850 / 22790 / 24770 Support: 19650 / 18680 / 17710 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:HK50Short
by VantageMarkets
Buying HKEX on dips.HS50 - 24h expiry - We look to Buy at 20260 (stop at 20090) Selling pressure from 20753 resulted in all the initial daily gains being overturned. The current move lower is expected to continue. Short term bias is mildly bullish. We therefore, prefer to fade into the dip with a tight stop in anticipation of a move back higher. Further upside is expected although we prefer to buy into dips close to the 20210 level. Our profit targets will be 20690 and 20770 Resistance: 20850 / 22790 / 24770 Support: 19650 / 18680 / 17710 lease 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:HK50Long
by VantageMarkets
Hang Seng Index to turnaround?HS50 - 24h expiry - We look to Sell a break of 20150 (stop at 20455) Previous support located at 20250. Previous resistance located at 20500. Price action has stalled at good resistance levels and currently trades just below here (20600). We expect a reversal in this move. A move through 20150 will confirm the bearish momentum. Our profit targets will be 19400 and 19200 Resistance: 20500 / 20525 / 20600 Support: 20250 / 20150 / 19500 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:HK50Short
by VantageMarkets
HKEX to stall at previous swing high?HS50 - 24h expiry - We look to Sell at 20209 (stop at 20430) Although the bulls are in control, the stalling positive momentum indicates a turnaround is possible. This is negative for sentiment and the downtrend has potential to return. Previous resistance located at 20209. The medium term bias remains bearish. Further downside is expected although we prefer to set shorts at our bespoke resistance levels at 20209, resulting in improved risk/reward. Our profit targets will be 19575 and 18680 Resistance: 20850 / 22790 / 24770 Support: 19650 / 18680 / 17710 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:HK50Short
by VantageMarkets