Weekly Updates 06/11/23 – 10/11/23 November 6, 2023
This weekly update is designed to help you stay informed and relate economic and company earnings to potentially value-add your CFD (Contract For Difference) trading via hedging (risk reducing). This article should be used for educational purposes only and not as financial advice. We urge all traders to carry out your own due diligence before submitting trades.
Recap for last week (30 Oct 2023 – 03 Nov 2023)
*These prices are taken based on the previous Monday’s opening price and the preceding Friday’s closing price.
Last week’s market movement revolved around the unanimous decision of the Fed to leave the rates unchanged. This allows the previous rate hike to take a greater hold of the US economy while the FED continues to examine whether another rate hike will be necessary. A rapid rise in the US Treasury yields has prompted some hawkish policymakers to signal another pause for the rise in rates at last week’s meeting as many forecasters expect spending and growth to slow down as larger debt payments, lower income gains and shrinking cash piles weigh on households. This sends most of the indexes to positive gains last week.
Updates for the week (06 Nov 2023 – 10 Nov 2023)
The data below showing the economic releases read as “Analyst’s estimate/ Consensus | Previous data”.
This week’s macro news mainly focuses on the US as it may set the tone of the US FED meeting next month. The consumer sentiment is expected to drop from 63.8 to 63.5 as rising prices and higher interest rates are pressuring households. Many market participants’ eyes are on the world’s second biggest economy posting their Trade balance and CPI data to determine the current economic conditions in China and forward guidance.
Traders should position their portfolio before the macro news release to not be negatively affected and have good risk management.
This week’s corporate earnings focuses on healthcare sector including Vertex, BDX, Gilead while tech companies like Grab and Uber are releasing their earnings. The US healthcare sector are still facing difficulties due to continuing high inflation rates and labour shortages, these company’s earning release allow investors to better understand the future direction of this sector. Many market participants are laying their eyes on Li Auto as it will give them a forward guidance of how the EV industry is unfolding in the upcoming months.
If you hold equity positions in these stocks, you can hedge your positions using CFDs to mitigate the risk of disappointing earnings releases.
For those looking to speculate or capitalize on the increased volatility, CFDs provide leverage and ease of going long and short across a broad range of products available.
USD/JPY Testing Multi-year High On Strong Momentum – by Jeraldine
Key Entry Price Pivot(s):
- 151.75
Recommended Trade:
- Short at 151.50
- Stop Loss at 152.50 (100 pips)
- Take Profit at 148.50 (300 pips)
Alternative Case:
- Long at 152.25
- Stop Loss at 151.25 (100 pips)
- Take Profit at 154.25 (200 pips)
Remarks:
- USD/JPY tried to test the multi-year high this week and was rejected before reaching the target of 151.945
- However, momentum remains strong and USD/JPY is in a tight bull channel within a broad bull channel
- Given this, we may expect another leg up to test the high before taking a breather to come back down to the bottom of the broad bull channel
- Traders who are bearish USD/JPY from here on can structure a short trade on a re-test of the recent high (or multi-year high of 151.945 if conservative) for a move down to bottom of broad bull channel
- Alternative case is presented above for traders who remain bullish on USD/JPY to structure a breakout trade
If you have any feedback or questions, feel free to email us at samht@phillip.com.sg or onishathyeyn@phillip.com.sg or cfd@phillip.com.sg.
Disclaimer
This material is provided to you for general information only and does not constitute a recommendation, an offer or solicitation to buy or sell the investment product mentioned. It does not have any regard to your specific investment objectives, financial situation or any of your particular needs.
Accordingly, no warranty whatsoever is given and not liability whatsoever is accepted for any loss arising whether directly or indirectly as a result of your acting based on this information. Investments are subject to investment risks.
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About the author
Sam Hei Tung (Dealing) and Onisha Thye (Dealing)
Sam graduated from National University of Singapore with a Master of Science in Finance. He personally manages his own investment portfolio and does equity and economic research in his free time. Sam believes that education and information is essential to making good financial decisions.
Onisha is a dealer at the CFD Dealing Desk. She graduated from Monash University with a double major in finance and econometrics. Her natural curiosity for finance is what drove her to be in this field as she is fascinated by all the possibilities and opportunities that are available to grow one’s wealth, either through trading or investment.
