Technical Analysis / Chartered Market Technician, The Markets Academy

David Coloretti, CMT

Technical Analysis / Chartered Market Technician

The Markets Academy

TMA implements 2 strategies. 1) Tactical ... Trend Sustainability Score (TSS) allows TMA to identify exhaustion / reversal points in interim trends by utilising our proprietary analysis of ST momentum indicators. 2) Medium Term ... our 3 Pillars approach to technical analysis allows TMA to determine high probability medium term outcomes in markets.

Technical Analysis

<ul>
<li>CME US has declined 19% in the August to October period.</li>
<li>Our proprietary TSS methodology deems the interim downtrend to be exhausted (Trend Sustainability Score &lt; 10).</li>
<li>One last low in the coming 1-2 days, below 168.49, has a high probability of being unsustainable and triggering an upward correction of minimum 3-5% in the coming 1-2 weeks.</li>
</ul>


CME US has declined 19% in the August to October period.
Our proprietary TSS methodology deems the interim downtrend to be exhausted (Trend Sustainability Score &lt; 10).
One last low in the coming 1-2 days, below 168.49, has a high probability of being unsustainable and triggering an upward correction of minimum 3-5% in the coming 1-2 weeks.


CME Group Inc (CME US): TSS < 10 - Next Low Likely to Fail and Reverse 3-5%.

China and US Equity Analyst

Roger Xie

Cross Asset Strategy

<ul>
<li>SEC rejected several applications to offer bitcoin spot ETF, and Grayscale Investment is considering suing the agency turns down its long-running proposal to convert its bitcoin trust to an ETF.</li>
<li>FED offered a balanced view on risk and reward of potential US central bank digital currency (CBDC), which could imply that FED might intend to issue CBDC in the future.</li>
<li>We estimated crypto trading volumes are down over 40% quarter-over-quarter on the back of lower prices and volatility. Bitcoin spot price was down as much as 27% in 1Q22.</li>
</ul>


SEC rejected several applications to offer bitcoin spot ETF, and Grayscale Investment is considering suing the agency turns down its long-running proposal to convert its bitcoin trust to an ETF.
FED offered a balanced view on risk and reward of potential US central bank digital currency (CBDC), which could imply that FED might intend to issue CBDC in the future.
We estimated crypto trading volumes are down over 40% quarter-over-quarter on the back of lower prices and volatility. Bitcoin spot price was down as much as 27% in 1Q22.


Crypto: Bitcoin Spot ETF And Fed Digital Currency Report

Equity Bottom-Up

<ul>
<li>LME Nickel future trading will be resumed on March 16 after its epic price surge before halting; the focus will be on safe reopen as more restrictions will be applied</li>
<li>The trading suspension benefits Chinese billionaire behind Nickel short position, who has secured bank lending in past few days. The angry parties are mainly hedge fund and financial investors. </li>
<li>We remain bullish on HKEX (388 HK) with the view that China economy will likely rebound in 2022, which will drive the rebound of IPO activities and trading volume. </li>
</ul>


LME Nickel future trading will be resumed on March 16 after its epic price surge before halting; the focus will be on safe reopen as more restrictions will be applied
The trading suspension benefits Chinese billionaire behind Nickel short position, who has secured bank lending in past few days. The angry parties are mainly hedge fund and financial investors. 
We remain bullish on HKEX (388 HK) with the view that China economy will likely rebound in 2022, which will drive the rebound of IPO activities and trading volume. 


HKEx (388.HK): Aftermath of Epic Short Squeeze of Nickel Future

Silver Point

Thomas J. Monaco

Silver Point is a boutique research firm that focuses on the broader financial services sector, with a particular focus on troubled institutions globally. 

Asia Ex Japan

<ul>
<li>HKEX reported a weak set of 4Q21 earnings results of HKD 2.7 bn, declining HKD 577 mn (17.7%) linked quarter, driven by the decline in cash ADT and higher costs; </li>
<li>Derivative activity remained flattish linked quarter with contract volume at 507 thousand – despite the successful launch of the MSCI China A50 Connect (HK A50); and </li>
<li>With HIBOR set to increase, HKEx is likely to become more reliant on lower quality investment income. </li>
</ul>


HKEX reported a weak set of 4Q21 earnings results of HKD 2.7 bn, declining HKD 577 mn (17.7%) linked quarter, driven by the decline in cash ADT and higher costs; 
Derivative activity remained flattish linked quarter with contract volume at 507 thousand – despite the successful launch of the MSCI China A50 Connect (HK A50); and 
With HIBOR set to increase, HKEx is likely to become more reliant on lower quality investment income. 


Hong Kong Exchanges & Clearing – Negative Jaws

<ul>
<li>SGX FY 1H22 core results were not robust, coming in at SGD 216 mn, improving just SGD 1.0 mn (0.5%) HOH and reflected weakened revenues; </li>
<li>Derivatives revenue improved 3.4% HOH, resultant of slightly higher contract volumes, and higher rates and lower discounts. HKEX's foray into the A50 will ultimately eat away at SGX’s business; and </li>
<li>Significant strategic alternatives are needed at SGX, if it is to avoid being hollowed out by the HKEX. </li>
</ul>


SGX FY 1H22 core results were not robust, coming in at SGD 216 mn, improving just SGD 1.0 mn (0.5%) HOH and reflected weakened revenues; 
Derivatives revenue improved 3.4% HOH, resultant of slightly higher contract volumes, and higher rates and lower discounts. HKEX's foray into the A50 will ultimately eat away at SGX’s business; and 
Significant strategic alternatives are needed at SGX, if it is to avoid being hollowed out by the HKEX. 


United States

CME Group Inc. operates a derivatives exchange that trades futures contracts and options on futures, interest rates, stock indexes, foreign exchange and commodities.  The Exchange brings together buyers and sellers of derivatives products on its trading floors, electronic trading platform, and through privately negotiated transactions that it clears.

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Cme Group Inc (CME US)