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

EURO STOXX 50 Price EUR / Technical Analysis

<ul>
<li>Key support levels on global equity indexes (EURO STOXX 50, $ACWX, $EFA) are beginning to break as the U.S. dollar (DXY) and 10-year Treasury yield break above $105.70 and 4.35%.</li>
<li>This significantly increases the odds of a break below major $92-$93 support on $ACWI, and we would shift to a more cautious outlook only on a break below $92.</li>
<li>We shifted to overweight value within non-U.S. equities last week, and we are now also shifting to overweight small-caps within non-U.S. equities as well. Buys in Transportation, Communications, and HealthCare</li>
</ul>


Key support levels on global equity indexes (EURO STOXX 50, $ACWX, $EFA) are beginning to break as the U.S. dollar (DXY) and 10-year Treasury yield break above $105.70 and 4.35%.
This significantly increases the odds of a break below major $92-$93 support on $ACWI, and we would shift to a more cautious outlook only on a break below $92.
We shifted to overweight value within non-U.S. equities last week, and we are now also shifting to overweight small-caps within non-U.S. equities as well. Buys in Transportation, Communications, and HealthCare


Supports Starting to Break; Upgrading Non-U.S. Small-Caps to Overweight; Transports/Comm/HC Buys

Global Healthcare Analyst

Tina Banerjee

Equity Bottom-Up

<ul>
<li>
<a href="https://www.smartkarma.com/entities/cipla-ltd" target="_blank" data-smartkarma-citation="entities:3918:1" rel="noopener">Cipla Ltd (CIPLA IN)</a> is a strong play in Indian generic pharmaceutical industry, due to its niche and differentiated respiratory and peptide injectable portfolio, which has less competition.</li>
<li>The company has launched couple of complex respiratory products in the US market, which has accelerated its revenue growth. Multiple high-value launches are also lined up for this year.</li>
<li>Cipla’s India business is on a strong footing, led by core portfolio tailwind in prescription and trade generics businesses. Q2FY23 marked the sixth consecutive quarter of market beating growth.</li>
</ul>



Cipla Ltd (CIPLA IN) is a strong play in Indian generic pharmaceutical industry, due to its niche and differentiated respiratory and peptide injectable portfolio, which has less competition.
The company has launched couple of complex respiratory products in the US market, which has accelerated its revenue growth. Multiple high-value launches are also lined up for this year.
Cipla’s India business is on a strong footing, led by core portfolio tailwind in prescription and trade generics businesses. Q2FY23 marked the sixth consecutive quarter of market beating growth.


2023 High Conviction Idea: Cipla (CIPLA IN)- Complex Generics and India Business to Drive Growth

<ul>
<li>US cap-weighted Health Care (ETF: XLV-US) remains in a 4.5-month RS uptrend relative to the S&amp;P 500, and we have the Sector on watch for a potential upgrade to overweight.</li>
<li>The VanEck Pharmaceutical ETF (PPH-US) recently broke out topside a 9-month base and RS displays a bullish reversal. Zooming-out, we can see a 6+ year base breakout.</li>
<li>Buy: Eli Lilly (LLY-US), Astrazeneca (AZN-US), Novo Nordisk (NOVO.B-DK), Roche (ROG-CH), Bristol-Myers Squibb (BMY-US), Bayer AG (BAYN-DE), UCB S.A. (UCB-BE), Ipsen SA (IPN-FR), ONO Pharmaceutical (4528-JP), and Teva Pharmaceutical (TEVA-US)</li>
</ul>


US cap-weighted Health Care (ETF: XLV-US) remains in a 4.5-month RS uptrend relative to the S&amp;P 500, and we have the Sector on watch for a potential upgrade to overweight.
The VanEck Pharmaceutical ETF (PPH-US) recently broke out topside a 9-month base and RS displays a bullish reversal. Zooming-out, we can see a 6+ year base breakout.
Buy: Eli Lilly (LLY-US), Astrazeneca (AZN-US), Novo Nordisk (NOVO.B-DK), Roche (ROG-CH), Bristol-Myers Squibb (BMY-US), Bayer AG (BAYN-DE), UCB S.A. (UCB-BE), Ipsen SA (IPN-FR), ONO Pharmaceutical (4528-JP), and Teva Pharmaceutical (TEVA-US)


Buy Global LargeCap Pharma: LLY, AZN, NOVO.B-DK, ROG-CH, BMY, BAYN-DE, UCB-BE, IPN-FR, 4528-JP, TEVA

<ul>
<li>The lows have likely been established for this correction, but a bottoming process would likely take weeks or potentially months and could come with more tests of the lows.</li>
<li>Japan's TOPIX and Nikkei 225 are each testing their respective downtrends. The EURO STOXX 50 is testing resistance in the 4040-4090 range. Germany's DAX is testing major resistance at 14,815-14,950.</li>
<li>It is likely that this initial 2-3 week bounce has run its course; stick with cyclical value and defensives, areas we have been focused on for most of 2022.</li>
</ul>


The lows have likely been established for this correction, but a bottoming process would likely take weeks or potentially months and could come with more tests of the lows.
Japan's TOPIX and Nikkei 225 are each testing their respective downtrends. The EURO STOXX 50 is testing resistance in the 4040-4090 range. Germany's DAX is testing major resistance at 14,815-14,950.
It is likely that this initial 2-3 week bounce has run its course; stick with cyclical value and defensives, areas we have been focused on for most of 2022.


Sticking With Cyclical Value and Defensives; Adding Large-Cap Japan Technology

<ul>
<li>We continue to see some encouraging signs that suggest that the lows may have been established for this correction.</li>
<li>We still believe a bottoming process would likely take weeks or potentially months and could come with more tests of the lows -- or even an undercut.</li>
<li>With that said, we continue to see attractive and actionable setups, primarily within cyclical value (Energy, Materials, Manufacturing, Transportation, and Financials).</li>
</ul>


We continue to see some encouraging signs that suggest that the lows may have been established for this correction.
We still believe a bottoming process would likely take weeks or potentially months and could come with more tests of the lows -- or even an undercut.
With that said, we continue to see attractive and actionable setups, primarily within cyclical value (Energy, Materials, Manufacturing, Transportation, and Financials).


Encouraging Signs, But Concerns Still Outweigh; Buying Materials, Energy, Industrials, Health Care

France

Ipsen SA manufactures and markets a wide range of medical drugs for targeted disease areas including oncology, endocrinology, and neuromuscular disorders.

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Ipsen SA (IPN FP)

Supports Starting to Break; Upgrading Non-U.S. Small-Caps to Overweight; Transports/Comm/HC Buys

Support levels on global indexes (EURO STOXX 50, $ACWX, $EFA) beginning to break as $DXY and 10-year Treasury yield $TNX break above $105.70 and...

Vermilion Research

2023 High Conviction Idea: Cipla (CIPLA IN)- Complex Generics and India Business to Drive Growth

Cipla is a strong play on Indian pharma. Riding on a differentiated product portfolio and new launches gaining market share, Cipla is well...

Tina Banerjee

Buy Global LargeCap Pharma: LLY, AZN, NOVO.B-DK, ROG-CH, BMY, BAYN-DE, UCB-BE, IPN-FR, 4528-JP, TEVA

The VanEck Pharmaceutical ETF $PPH recently broke out topside a 9-month base and RS displays a bullish reversal. Zooming-out, we can see a 6+ year...

Vermilion Research

Sticking With Cyclical Value and Defensives; Adding Large-Cap Japan Technology

Sticking With Cyclical Value & Defensives; Adding Large-Cap Japan Technology. 2-3 week bounce has likely run its course with $TOPIX $Nikkei 225,...

Vermilion Research

Encouraging Signs, But Concerns Still Outweigh; Buying Materials, Energy, Industrials, Health Care

We continue to see some encouraging signs that suggest that the lows may have been established for this correction. Still, cyclical value remains...

Vermilion Research

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