Weekly Updates 24/6/24 – 28/6/24 June 26, 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 (20 June 2024 – 21 June 2024)
*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 BOE leaving rates on hold at 5.25% where more policymakers may be close to bracing interest rate cuts keeping alive hopes of loosening by the end of 2024. This will put it closer to the expected timing of the Fed’s first interest rate cut than BOE where Fed started loosening policy earlier this month. Nvidia shares stalled at high altitude last week, leaving investors to ponder where the S&P500 and Nasdaq are poised for a major setback if the ringleader of an increasingly concentrated cohort of market winners sees a sustained stumble. This lead to the fall in S&P500 and Nasdaq by 0.34% and 0.02% each.
Updates for the week (24 June – 28 June 2024)
The data below showing the economic releases read as “Analyst’s estimate/ Consensus | Previous data”.
This week ahead, markets are trying to assess when will the US Fed cut rates. Key data coming out of the US will be GDP which is expected to grow 1.4% annualized. Showing a strong and resilient economy even with higher-than-expected inflation. Personal spending and Personal income is expected to increase slightly, showing that analysts expect the US consumer to remain strong. Any weakness in the economy could signal the Fed to cut rate sooner than previously forecasted. For Hong Kong and Singapore, investors will lay eyes on HK Exports and SG CPI data to take it as a forward guidance in their investment outlook.
This week’s corporate earnings mainly focus on FedEx, Micron, Carnival and Nike from the US market. With Micron having an impressive YTD gain of 68.82%, analysts are eager to see the forward guidance for upcoming top line and bottom-line projection. Market participants are also focusing on Carnival Corp’s earnings release as market participants are anticipating an overall positive net income soon given Carnival’s underperformance against other competitors like Royal Caribbean.
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. As CFD is traded on margin, there is a risk of losing more than your initial deposit amount and traders need to adopt proper risk assessment and management to determine if CFD is the product for you.
M\EURUSD: Bearish Momentum
Key Entry Price Pivot(s)
- 1.07559
Recommended Trade
- Short at 1.0769
- Stop Loss: 1.07873
- Take Profit: 1.06944
Alternative Case
- Long at 1.07637
- Stop Loss: 1.07201
- Take Profit: 1.07832
Remarks
- If you have any Bearish market structure since early June
- With a bearish price imbalance above current prices, shorts can be taken around 50% of the fair value gap.
- Stop-loss can be set above the FVG around 1.07873 while targeting liquidity resting below for take profit.
- Alternative trade would be a long at current prices, targeting the FVG fill at 1.07832 with stop-loss at 1.07021.
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.
You are advised to read the trading account Terms & Conditions and Risk Disclosure Statement (available online at www.poems.com.sg) before trading in this product. Any CFD offered is not approved or endorsed by the issuer or originator of the underlying securities and the issuer or originator is not privy to the CFD contract. This advertisement has not been reviewed by the Monetary Authority of Singapore.
CFD Disclaimer
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 qualified 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. You are advised to read the trading account Terms & Conditions and Risk Disclosure Statement (available online at https://www.poems.com.sg/) before trading in this product.
Any CFD offered is not approved or endorsed by the issuer or originator of the underlying securities and the issuer or originator is not privy to the CFD contract.
This advertisement has not been reviewed by the Monetary Authority of Singapore.
This material is intended for general circulation only and does not take into account the specific investment objectives, financial situation or particular needs of any particular person. You should seek advice from a financial adviser regarding the suitability of the investment product, taking into account your specific investment objectives, financial situation or particular needs, before making a commitment to invest in such products.
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.
