In today’s briefing:
- Asia Top Short Update
- RTY Support Inflection Break
- Europe, Japan, $ACWI Testing Critical Supports; Rising DXY, Global Sovereign Yields a Major Headwind
Asia Top Short Update
- Our top short bets in Asia (HSI, Taiwan, Korea) show risk of breaking to new lows. The RTY breaks gives the bear trade another leg down.
- Our relative perform longs (STI and SET 50) are due to drift to support but holding up well. USD is breaking to new highs with momentum.
- Asian markets that have held up are now at risk of late-stage capitulation – ASX, Nifty and NKY.
RTY Support Inflection Break
- Fed bounce used to add to NDX short at 12,100. RTY break below 1,775 is the more damning inflection pivot to see bear momentum accelerate in our short group.
- RTY below 1,775 targets 1,710 and 1,690. NDX increased bear pressure to crack 11,500/400 support and reach for that key 11k macro support level.
- SPX 3,750 pressure test. RTY implies we crack 3,750 and reach for the June low. 3,500 is our new low PT then bull probe in late September/early October.
Europe, Japan, $ACWI Testing Critical Supports; Rising DXY, Global Sovereign Yields a Major Headwind
- Many major indexes are still testing (and holding above) critical supports. This includes MSCI ACWI (ACWI-US), TOPIX/TOPIX Small/Nikkei 225, EURO STOXX 50, STOXX Europe 600, and the DAX
- Our overall outlook remains neutral, and we continue to see many attractive buying opportunities, especially out of Japan, India, and a new one — Brazil.
- Buy ideas focus on the Consumer Discretionary and Financials Sectors, with the vast majority of stock recommendations from Japan, India, and Brazil
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