Weekly Updates 29/4/24 – 3/5/24 April 29, 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 (22 Apr 2024 – 26 Apr 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 Meta falling 15% on Thursday due to fears over AI while their sales outlook was disappointing, however S&P 500 closed higher by 2.25% on Friday as mega cap tech stocks’ shares rallied (Microsoft and Alphabet). The US economic growth slowed more than expected in Q1, but with an acceleration in inflation suggested that the Fed will not cut interest before September. Fed will need to determine how sticky inflation is which will mean higher for longer monetary policy. By allowing tight policy more time to tamp down demand and wrestle inflation back to the Fed’s 2% target. The Bank of Japan held interest rates steady on Friday and simplified its language on bond-buying and policy, an outcome that pushed the yen down to a fresh three-decade low.
Updates for the week (29 Apr 2024 – 03 May 2024)
The data below showing the economic releases read as “Analyst’s estimate/ Consensus | Previous data”.
Upcoming week macro-news releases focuses on China manufacturing data on Tuesday 30th April and US employment, FOMC rate decision and manufacturing data. Comments from FOMC members and chair J.Powell will set the tone for the narrative on rate decisions going forward. Investors and traders are eager to determine if the bullish sentiment on both China and Hong Kong stocks will continue, with China manufacturing data on Tuesday as well.
This week’s corporate earnings mainly focuses on US stocks such as Amazon, Apple and AMD. While Microsoft and Google topped expectations last week, investors are setting the standards high for this week, as many investors believe AI is the lead of the next generation of technology. However, if the magnificent 7 chuck too much cash at AI, shareholders may worry about reckless spending will affect the bottom line. China’s EV maker BYD earnings release will set the tone for China EV industry, investors and traders should adopt proper risk management going in to earning season.
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.
CityDev (CID.SG): Downtrend Channel – by Sean Ng
Key Entry Price Pivot(s)
- $6.05
Recommended Trade
- Short Below $6.05
- Take Profit at $5.20
- Stop Loss at $6.20
Alternative Case
- Long Above $6.20
- Take Profit at $6.76
- Stop Loss at $5.98
Remarks
- CID.SG has been forming a descending channel with price trading at the upper resistance level
- Traders can potentially look to take a short trade if CID.SG rebounds off of the upper resistance level, or a long trade if it breaks upwards with strong volume
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.