Technical Analyst, Vermilion Research

Joe Jasper

Technical Analyst

Technical and Quantitative Research

Vermilion Research

Vermilion’s objective is to deliver timely, actionable, and unique technical research to professional investors through the application of our various technical indicators.

Our research strategists seek to highlight securities which we believe are at major inflection points, based on our various technical and quantitative indicators, and offer asymmetric risk/return profiles. Our unique research methodology, centered on relative strength, enables our strategists to deliver superior investment recommendations.

Our process begins by organizing the universe of actively traded stocks into discrete sectors, then into industry groups. We then apply our technical and quantitative tools to identify developing price trends. Once attractive trends are identified within a selected sector or group, we screen for individual stocks which we believe offer the best risk/reward profile. We provide a historical perspective that often reveals, through our long-term charts, how price patterns often repeat themselves over time.

Technical Analysis

iShares Russell 2000 ETF / Technical Analysis

<ul>
<li>We remain bearish as long as the YTD downtrends remain intact on the SPX and NDX (QQQ), and as long as the 7.5-month downtrend remains intact on the Russell 2000(IWM).</li>
<li>There is potential for a bounce given the SPX, QQQ, and IWM are all at downtrend channel supports.</li>
<li>The continued rise of the U.S. dollar (DXY), 10-yr Treasury yield, and WTI crude oil is what we believe is fueling the bear market in equities.</li>
</ul>


We remain bearish as long as the YTD downtrends remain intact on the SPX and NDX (QQQ), and as long as the 7.5-month downtrend remains intact on the Russell 2000(IWM).
There is potential for a bounce given the SPX, QQQ, and IWM are all at downtrend channel supports.
The continued rise of the U.S. dollar (DXY), 10-yr Treasury yield, and WTI crude oil is what we believe is fueling the bear market in equities.


Downgrading Materials; SPX, NDX, Russell 2000 Testing Downtrend Channel Support; Biotech Buys

<ul>
<li>We see the S&amp;P 500 as trading within a downtrend channel; as long as it remains within this channel, our intermediate to long-term outlook is bearish at the index level.</li>
<li>With that said, the S&amp;P 500 is currently testing support within the downtrend channel, and we are on watch for a potential bear market rally.</li>
<li>We will need to see a bullish reversal of the 1-month downtrend (currently at 4030-4050) to have confidence that a tradeable bounce is underway, with the potential for more.</li>
</ul>


We see the S&amp;P 500 as trading within a downtrend channel; as long as it remains within this channel, our intermediate to long-term outlook is bearish at the index level.
With that said, the S&amp;P 500 is currently testing support within the downtrend channel, and we are on watch for a potential bear market rally.
We will need to see a bullish reversal of the 1-month downtrend (currently at 4030-4050) to have confidence that a tradeable bounce is underway, with the potential for more.


S&P 500 Downtrend Channel Intact & Testing Support; Buy Ideas Within Energy & Biotech

Global Healthcare Analyst

Tina Banerjee

Equity Bottom-Up

<ul>
<li>
<a href="https://www.smartkarma.com/entities/celltrion-inc" target="_blank" data-smartkarma-citation="entities:991:1" rel="noopener">Celltrion Inc (068270 KS)</a> reported muted Q1 results, with revenue, operating profit, and net profit declining quarter-over-quarter. Its biosimilar products in the EU are facing price competition.</li>
<li>Celltrion has recalled its COVID-19 rapid antigen test kits in the U.S. in April, which marks its third such recall in less than two months.</li>
<li>Celltrion shares plunged 15% since I published bearish insight on the company on March 8. Bear thesis of biosimilar competition still holds good for the company.</li>
</ul>



Celltrion Inc (068270 KS) reported muted Q1 results, with revenue, operating profit, and net profit declining quarter-over-quarter. Its biosimilar products in the EU are facing price competition.
Celltrion has recalled its COVID-19 rapid antigen test kits in the U.S. in April, which marks its third such recall in less than two months.
Celltrion shares plunged 15% since I published bearish insight on the company on March 8. Bear thesis of biosimilar competition still holds good for the company.


Celltrion (068270 KS): Muted Q1 2022 Performance Reflects Continuing Biosimilars Pricing Pressure

HK/China Healthcare Analyst (ex-Fosun Pharma)

Xinyao (Criss) Wang

Thematic (Sector/Industry)

<ul>
<li>FDA’s CRL on Hutchmed and Junshi indicates if there’s no real innovation, there’s little point in doing MRCT. Chinese companies must re-evaluate the costs of internationalization.There’s nothing related to “politics”.</li>
<li>DRGs is a policy that will have a significant impact on the development trend of the entire healthcare industry, because it would change doctors’ interest orientation and companies’ profit model.</li>
<li>However, we believe that DRGs will be a top-level policy design, which will gradually be followed by supporting policies, such as special subsidies for innovation.</li>
</ul>


FDA’s CRL on Hutchmed and Junshi indicates if there’s no real innovation, there’s little point in doing MRCT. Chinese companies must re-evaluate the costs of internationalization.There’s nothing related to “politics”.
DRGs is a policy that will have a significant impact on the development trend of the entire healthcare industry, because it would change doctors’ interest orientation and companies’ profit model.
However, we believe that DRGs will be a top-level policy design, which will gradually be followed by supporting policies, such as special subsidies for innovation.


China Healthcare Weekly (May.6)-FDA’s CRL on Junshi/HCM, Biotech Globalization, Significance of DRGs

US Treasury (10 Yr Generic) / Technical Analysis

<ul>
<li>We have discussed our expectations for rising rates for quite some time, but the 10-year yield is now testing 40-year downtrend resistance which comes in at 2.80-2.82%.</li>
<li>If there was ever a time for interest rates to move lower, this is where it needs to happen -- and it would be fitting, considering extremely bearish bond sentiment.</li>
<li>On the other hand, if the 10-year Treasury is above 2.82% we see a secular reversal where rising rates would be the new normal</li>
</ul>


We have discussed our expectations for rising rates for quite some time, but the 10-year yield is now testing 40-year downtrend resistance which comes in at 2.80-2.82%.
If there was ever a time for interest rates to move lower, this is where it needs to happen -- and it would be fitting, considering extremely bearish bond sentiment.
On the other hand, if the 10-year Treasury is above 2.82% we see a secular reversal where rising rates would be the new normal


10-Year Treasury Yield Testing 40-Year Resistance; Upgrading Health Care to Overweight

United States

Amgen Inc. is an independent biotechnology medicines company that discovers, develops, manufactures and markets medicines for grievous illnesses. The Company focuses solely on human therapeutics and concentrates on innovating novel medicines based on advances in cellular and molecular biology.

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Amgen Inc (AMGN US)

Downgrading Materials; SPX, NDX, Russell 2000 Testing Downtrend Channel Support; Biotech Buys

We remain bearish as long as the 6-8 month downtrends remain intact on the SPX, NDX (QQQ), and RUT (IWM). Bounce potential given SPX, QQQ, and IWM...

Vermilion Research

S&P 500 Downtrend Channel Intact & Testing Support; Buy Ideas Within Energy & Biotech

The $SPX is trading within a downtrend channel; as long as it remains within this channel, our intermediate to long-term outlook is bearish at the...

Vermilion Research

Celltrion (068270 KS): Muted Q1 2022 Performance Reflects Continuing Biosimilars Pricing Pressure

Celltrion reported weak Q1 results, with its operating and net profit declining y/y as well as q/q. Biosimilar selling price continues to erode due...

Tina Banerjee

China Healthcare Weekly (May.6)-FDA’s CRL on Junshi/HCM, Biotech Globalization, Significance of DRGs

The FDA announced its CRL on Hutchmed’s surufatinib and Junshi’s PD-1. It's time to reexamine the logic and prospects of biotech globalization. The...

Xinyao (Criss) Wang

10-Year Treasury Yield Testing 40-Year Resistance; Upgrading Health Care to Overweight

10-year Treas yield $TNX is now testing 40-year downtrend resistance at 2.8-2.82%. If interest rates are to move lower, now would be the time,...

Vermilion Research

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