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

In last week’s Compass (5/14) we laid our case for a more cautious outlook as a result of several negative developments, including breakdowns for EM (EEM) and China (MCHI, FXI), steep price and RS uptrend violations for Technology (XLK, RYT), improving RS for defensive areas of the market, and weakness in copper. Our outlook remains neutral. In today’s report we highlight attractive Groups and stocks within Consumer Staples and Utilities.

In last week’s Compass (5/14) we laid our case for a more cautious outlook as a result of several negative developments, including breakdowns for EM (EEM) and China (MCHI, FXI), steep price and RS uptrend violations for Technology (XLK, RYT), improving RS for defensive areas of the market, and weakness in copper. Our outlook remains neutral. In today’s report we highlight attractive Groups and stocks within Consumer Staples and Utilities.

U.S. Equity Strategy: Neutral Outlook; Opportunities Within Staples and Utilities

Chart based progressive global trading strategies, Chart Partners

Thomas Schroeder

Chart based progressive global trading strategies

Chart Partners

Chart Partners objective is to discover medium-term cycle turns and profit opportunities before they unfold, within structural trends while preserving capital with clear degrees of risk. We have real return ideas. 

Markets are dynamic and trading systems must reflect this. It is crucial to determine underlying correlations and lead-lag relationships within global markets and the impact on linked instruments. Our weekly Chartonics product gives you short-term trading strategies that can be applied within the medium and longer term macro trends that are mapped out in our strategy updates. 

Our methodology fuses global market variables and isolates drivers in trends. We specialize in FX, index trade in NY and Asia with a focus on Asian stocks. 

iShares FTSE/Xinhua A50 China / Technical Analysis

We touch on key pivots for the global cycle in the NDX (recent highs) and laid out in our recent insight <a href="https://www.smartkarma.com/insights/spx-set-up-mirrors-september-2018" target="_blank" data-smartkarma-citation="insights:29247">SPX Set up Mirrors September 2018</a> . The SPX RSI pattern mirrors the late 2018 cycle with higher confidence break down signal unfolding today.With China a crowded long bet, we noted non confirmation in many of our technical sets on recent highs with buy volumes tapering off and divergences building.China A shares have broken some key tactical supports that set up a draw down to test macro pivot support at A50 12,000.We believe that at least 70% of a trade deal has been baked into current prices. An unwind of this bet would hit markets hard with some key chart levels to focus on.

We touch on key pivots for the global cycle in the NDX (recent highs) and laid out in our recent insight SPX Set up Mirrors September 2018 . The SPX RSI pattern mirrors the late 2018 cycle with higher confidence break down signal unfolding today.With China a crowded long bet, we noted non confirmation in many of our technical sets on recent highs with buy volumes tapering off and divergences building.China A shares have broken some key tactical supports that set up a draw down to test macro pivot support at A50 12,000.We believe that at least 70% of a trade deal has been baked into current prices. An unwind of this bet would hit markets hard with some key chart levels to focus on.

Shanghai Stock Exchange Composite Index / Technical Analysis

The MSCI EM index continues to develop positively from a price perspective and we expect higher prices ahead. China remains leadership -- overweight. At the same time we recommend selectivity in new purchases considering many Chinese equities are extended. In this report we highlight a number of attractive stocks from Chines markets as well as opportunities within Greece, South Africa, India, and Taiwan.

The MSCI EM index continues to develop positively from a price perspective and we expect higher prices ahead. China remains leadership -- overweight. At the same time we recommend selectivity in new purchases considering many Chinese equities are extended. In this report we highlight a number of attractive stocks from Chines markets as well as opportunities within Greece, South Africa, India, and Taiwan.

EM Equity Strategy: Remain Overweight China

Incremental technical developments continue to be of the bullish variety as more and more countries/regions begin to participate in the rally. These ongoing improvements further cement our positive overall outlook, and we continue to believe that global equities (MSCI ACWI) are poised for additional strength moving forward. In our April International Strategy, we highlight various themes which lead to our overall positive outlook, along with areas within the world's markets where we see immediate opportunity.

Incremental technical developments continue to be of the bullish variety as more and more countries/regions begin to participate in the rally. These ongoing improvements further cement our positive overall outlook, and we continue to believe that global equities (MSCI ACWI) are poised for additional strength moving forward. In our April International Strategy, we highlight various themes which lead to our overall positive outlook, along with areas within the world's markets where we see immediate opportunity.

Global Ex-U.S. Equity Strategy: Positive Outlook Intact; Remain Overweight China

FTSE China A50 Index / Technical Analysis

<a href="https://www.smartkarma.com/entities/22905" target="_blank" data-smartkarma-citation="entities:22905:1">Ftse China A50 Index (XIN9I INDEX)</a> has been our top long bet in Asia from early January (10,800), outperforming both the HSCEI and HSI. Key chart points that suggest the A share rise will be getting ahead of itself after the next rally phase out of bullish triangulation. Once this breakout terminates we see evidence of a harder decline unfolding ahead of a trade deal. This window allows for a pullback ahead of a trade deal spike that will put in place a key cycle peak just under shanghai composite resistance that goes back to highs from 2009, 2016 and 2018.Keep in mind that China's cycle exhibits a series of rally and fade cycles that form a multi-year basing process. The Shanghai composite longer term chart outlined rally and basing cycle correlations.

Ftse China A50 Index (XIN9I INDEX) has been our top long bet in Asia from early January (10,800), outperforming both the HSCEI and HSI. Key chart points that suggest the A share rise will be getting ahead of itself after the next rally phase out of bullish triangulation. Once this breakout terminates we see evidence of a harder decline unfolding ahead of a trade deal. This window allows for a pullback ahead of a trade deal spike that will put in place a key cycle peak just under shanghai composite resistance that goes back to highs from 2009, 2016 and 2018.Keep in mind that China's cycle exhibits a series of rally and fade cycles that form a multi-year basing process. The Shanghai composite longer term chart outlined rally and basing cycle correlations.

Market Wrinkles Ahead of a US/China Deal Spike

China

The Shanghai Stock Exchange Composite Index is a capitalization-weighted index. The index tracks the daily price performance of all A-shares and B-shares listed on the Shanghai Stock Exchange. The index was developed on December 19, 1990 with a base value of 100. 

Shanghai Stock Exchange Composite Index (SHCOMP INDEX)

Shanghai Stock Exchange Composite Index (SHCOMP INDEX)

U.S. Equity Strategy: Neutral Outlook; Opportunities Within Staples and Utilities

In last week’s Compass (5/14) we laid our case for a more cautious outlook as a result of several negative developments, including breakdowns for...

Vermilion Research

China Game over Support Breaks

We touch on key pivots for the global cycle in the NDX (recent highs) and laid out in our recent insight SPX Set up Mirrors September 2018 . The...

Thomas Schroeder

EM Equity Strategy: Remain Overweight China

The MSCI EM index continues to develop positively from a price perspective and we expect higher prices ahead. China remains leadership --...

Vermilion Research

Global Ex-U.S. Equity Strategy: Positive Outlook Intact; Remain Overweight China

Incremental technical developments continue to be of the bullish variety as more and more countries/regions begin to participate in the rally....

Vermilion Research

Market Wrinkles Ahead of a US/China Deal Spike

Ftse China A50 Index (XIN9I INDEX) has been our top long bet in Asia from early January (10,800), outperforming both the HSCEI and HSI. Key chart...

Thomas Schroeder