Weekly Updates 18/3/24 – 22/3/24 March 18, 2024
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 (11 Mar 2024 – 15 Mar 2024)
*These prices are taken based on the previous Monday’s opening price and the preceding Friday’s closing price.
Last week’s market movements revolved around better than expected inflation data coming out of China, and analysts and market participants began to shift their sentiment to a more bullish and positive outlook. With Hang Seng Tech Index rallying 4.14%. US and Singapore government bonds spiked due to hotter than expected CPI data from the US, with bond traders accepting the fact that rates are most likely going to be higher for longer.
Updates for the week (18 Mar 2024 – 22 Mar 2024)
The data below showing the economic releases read as “Analyst’s estimate/ Consensus | Previous data”.
This week’s macro news mainly focuses on FOMC rate decision on Thursday 2am, Housing data coming out of the US such as housing starts, Existing home sales and initial jobless claims. With weakness in US smaller banks and property market, market participants and the Fed is monitoring closely to the health of the property markets. Additionally, traders and investors are paying close attention to FOMC’s comments on upcoming potential rate cuts.
This week’s corporate earnings focuses on tech companies like Tencent, Kuaishou, Meituan, Chewy, PDD, Micron, XPeng and XiaoMi. Mainly from the HK/China market, investors and traders need to pay attention to both earning releases and forward guidance to navigate the earning season. With most China/Hong Kong stocks recovering from recent lows, sentiments are more bullish than previous. Therefore, the upcoming earning releases will solidify the recent rally or a start of a new down trend.
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 Ascending Triangle In Uptrend – by Jeraldine
Key Entry Price Pivot(s)
- 151.91
Recommended Trade
- Long at 152.25
- Stop Loss at 146.25 (600 pips)
- Take Profit at 162.25 (1300 pips)
Alternative Case
- Short at 151.75
- Stop Loss at 152.75 (100 pips)
- Take Profit at 148.75 (300 pips)
Remarks
- USD/JPY testing high of 151.91 repeatedly and now forming ascending triangle pattern in an upward trending market
- Recommended trade suggests buying on a break out of the high that had been repeatedly tested. At this moment, stoploss is placed 600pips away which should be reviewed when trade is triggered (stop probably can be placed below the most recent low.
- Alternative case is presented for traders who believe in mean reversion in foreign exchange and are bearish USD/JPY – a short trade may be structured on a re-test of the high.
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.
The risk of loss in leveraged trading can be substantial. You may sustain losses in excess of your initial funds and may be called upon to deposit additional margin funds at short notice. If the required funds are not provided within the prescribed time, your positions may be liquidated.
The resulting deficits in your account are subject to penalty charges. The value of investments denominated in foreign currencies may diminish or increase due to changes in the rates of exchange.
You should also be aware of the commissions and finance costs involved in trading leveraged products. This product may not be suitable for clients whose investment objective is preservation of capital and/or whose risk tolerance is low.
Clients are advised to understand the nature and risks involved in margin trading. You may wish to obtain advice from a qualified financial adviser, pursuant to a separate engagement, before making a commitment to purchase any of the investment products mentioned herein. In the event that you choose not to obtain advice from a qualifies financial adviser, you should assess and consider whether the investment product is suitable for you before proceeding to invest and we do not offer any advice in this regard unless mandated to do so by way of a separate engagement.
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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.
