Technical Analysis

Our 2023 outlook remains unchanged as we continue to expect broad-based consolidation with $93 capping upside on MSCI ACWI (ACWI-US), while important downside targets are $86, $84, and $75-77.
We still recommend tactical overweight to defensives including gold miners and MSCI ACWI Staples, Health Care, and Utilities, given ACWI-US remains near the top of our expected 2023 trading range.
We are now starting to see broad-based improvement, particularly in Japan and India, but also in Taiwan and South Korea. Most of today’s buy recommendations are cyclicals in these countries.

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May 08

Daily Brief Technical Analysis: Agricultural Bank of China Ltd (1288 HK) – Target 13%-24% Uptrend in 2-3 Quarters. and more

By Smartkarma Daily Briefs | Daily Briefs, Technical Analysis

In today’s briefing:

Agricultural Bank of China Ltd (1288 HK) – Target 13%-24% Uptrend in 2-3 Quarters.
AAG Energy (2686) Favors Buying Weakness

Agricultural Bank of China Ltd (1288 HK) – Target 13%-24% Uptrend in 2-3 Quarters.

At TMA we deliver high probability outcomes by focusing on our 3 pillars of technical analysis. •1) Response to key levels. •2) Price action. •3) Momentum confirmation.
The LT downtrend structure in 1288 HK was simply defined by its 2018/2022 sequence of lower highs and lower lows. This structure was broken last week.
LT momentum indicators (monthly RSI / MACD) have recently confirmed this bullish LT trend change. The current uptrend appears set to extend towards 3.60/3.90 (+13%-24%) in the coming 2-3 quarters.

AAG Energy (2686) Favors Buying Weakness

AAG Energy (2686) exhibits a clear wedge range to trade with an intermediate positive outcome as long as lower wedge support stands up near outlined 1.50 support.
The intermediate cycle favors a bullish outcome as long as lower pattern support holds true. Wedge still needs time to mature.
1.70 is the level to clear for bull traction. Risk to 1.40 region if we fail to hold lower wedge support at 1.48.

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May 04

Daily Brief Technical Analysis: KRE Lead Breakdown and more

By Smartkarma Daily Briefs | Daily Briefs, Technical Analysis

In today’s briefing:

KRE Lead Breakdown

KRE Lead Breakdown

Bank jitters touted to resurface in May with growth concerns topping falling inflation data. SPX MACD in focus as a key bearish driver.
KRE bear break below 42 support targets 32.40 and will bleed into the SPX and the global cycle.
MACD cycle trough expected near mid-June and will set the stage for a bull recovery. Until then we are selling bounces per our May/June negative cycle.

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May 03

Daily Brief Technical Analysis: SPX and RTY to Reverse and more

By Smartkarma Daily Briefs | Daily Briefs, Technical Analysis

In today’s briefing:

SPX and RTY to Reverse, Euro Wedge and Asia Short/Long Update
S&P 500 Testing 4165-4200, DJIA Testing 34,280, Nasdaq Composite Testing 12,300; Stay Defensive

SPX and RTY to Reverse, Euro Wedge and Asia Short/Long Update

Cycle: May/June a more negative cycle. Late April negative/ turn phase is unfolding with a squeeze surprise (2-3 session swing turns). Sell SPX 4,200 top zone. 4,100 break will open up selling pressure.
RTY bear reversal at 1,790 resistance on track and the underperform favored US short.
Euro wedge break would pick up slack as the USD/JPY rise stalls at resistance. Asian equity short, long updated levels.

S&P 500 Testing 4165-4200, DJIA Testing 34,280, Nasdaq Composite Testing 12,300; Stay Defensive

We still recommend a tactical overweight to defensives (Staples, Utilities, Healthcare, and gold miners) as the SPX tests our 4165-4200 resistance range, and also resistance from the prior 1.5-month uptrend.
As we await Wednesdays FOMC announcement, the DJIA and Nasdaq Composite are testing 1-year resistances at 34,280 and 12,300, the DXY appears to be inflecting higher, and breadth remains weak.
While we still see a reach to 4300-4325 as possible, we believe playing for more upside is akin to picking up pennies in front of a steamroller.

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Apr 29

Daily Brief Technical Analysis: WTI Crude Oil Futures (CL1) – Weekly Close Setting Up to Confirm a Material MT Downtrend Bias and more

By Smartkarma Daily Briefs | Daily Briefs, Technical Analysis

In today’s briefing:

WTI Crude Oil Futures (CL1) – Weekly Close Setting Up to Confirm a Material MT Downtrend Bias
Stay Tactically Overweight Defensives; Remain Overweight Europe, Japan, & EAFE. Buys in Defensives

WTI Crude Oil Futures (CL1) – Weekly Close Setting Up to Confirm a Material MT Downtrend Bias

At TMA we deliver high probability outcomes by focusing on our 3 pillars of technical analysis. •1) Response to key levels. •2) Price action. •3) Momentum confirmation.
The past 3 weeks have produced a failed new 2023 high in WTI Crude Oil futures (CL1), a bearish weekly reversal pattern and a break below the recent prominent gap.
A weekly close below the gap base at 75.72 will confirm a renewed and dominant MT downtrend bias and target a retest of the 2023 low at 64.12.

Stay Tactically Overweight Defensives; Remain Overweight Europe, Japan, & EAFE. Buys in Defensives

Our 2023 outlook, initially discussed in our January 6th 2023 Int’l Compass, was for $93 to cap upside on the MSCI ACWI (ACWI-US); this has again proven prescient.
Since late-January/early-February we have recommended shifting to defensives, and MSCI ACWI defensive Sectors including Health Care (IXJ-US), Utilities (JXI-US), and Consumer Staples (KXI-US) are now hitting 3-4-month RS highs.
With the ACWI-US just now starting to turn down after testing $93, we continue to recommend a tactical overweight to the aforementioned defensive Sectors, and also to gold miners (GDX-US).

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Apr 28

Daily Brief Technical Analysis: Tencent Holdings Ltd (700 HK) – Q2 2023 Correction Presents a MT Buying Opportunity at 302/330 and more

By Smartkarma Daily Briefs | Daily Briefs, Technical Analysis

In today’s briefing:

Tencent Holdings Ltd (700 HK) – Q2 2023 Correction Presents a MT Buying Opportunity at 302/330

Tencent Holdings Ltd (700 HK) – Q2 2023 Correction Presents a MT Buying Opportunity at 302/330

At TMA we deliver high probability outcomes by focusing on our 3 pillars of technical analysis. •1) Response to key levels. •2) Price action. •3) Momentum confirmation.
Since peaking in January 2023, Tencent Holdings Ltd (700 HK) has produced a meaningful ABC correction that is yet to confirm its completion.
We anticipate the correction confirming a MT bottom in the 302/330 range, ahead of a renewed multi-month uptrend. Our bullish multi-month target at 451.95 remains firm.

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Apr 26

Daily Brief Technical Analysis: Bitcoin (XBTUSD) – Recent Decline Is Logical / Necessary / Counter-Trend and more

By Smartkarma Daily Briefs | Daily Briefs, Technical Analysis

In today’s briefing:

Bitcoin (XBTUSD) – Recent Decline Is Logical / Necessary / Counter-Trend
MSCI Emerging Markets Index (MXEF): Weekly Close Confirms Bearish Multi-Week Risk
“Sell in May” Another Reason to Be Defensive; Value to Lead?; Buys in Medical Devices, Footwear
Late April Break for a 6-Week Decline

Bitcoin (XBTUSD) – Recent Decline Is Logical / Necessary / Counter-Trend

At TMA we deliver high probability outcomes by focusing on our 3 pillars of technical analysis. 1) Response to key levels. 2) Price action. 3) Momentum confirmation.
Bitcoin (XBTUSD) confirmed a meaningful top in the past 2 weeks when it rejected material MT resistance levels and completed a bearish weekly reversal pattern.
With definitive bullish price and momentum triggers in play, we anticipate that a multi-week period of consolidation / correction will remain counter-trend. Searching for the next MT base towards 25200/25250.

MSCI Emerging Markets Index (MXEF): Weekly Close Confirms Bearish Multi-Week Risk

At TMA we deliver high probability outcomes by focusing on our 3 pillars of technical analysis. 1) Response to key levels. 2) Price action. 3) Momentum confirmation.
Throughout Q4 2022 / Q1 2023 each material turning point has been confirmed by a definitive weekly reversal pattern. Last week produced a definitive bearish weekly reversal pattern.
Long-Term charts imply that MXEF has entered a sustainable multi- quarter uptrend. Last week’s bearish weekly confirmation however, confirms risk of a further counter-trend correction in the coming weeks.

“Sell in May” Another Reason to Be Defensive; Value to Lead?; Buys in Medical Devices, Footwear

The SPX made a high of 4169 last week, tagging our 4165-4200 resistance range. We still believe 4165-4200 will cap upside in 2023, with a reach to 4300-4325 also possible.
Considering limited upside in both scenarios, and with the seasonably weaker “sell in May and go away” period approaching, we continue to recommend higher allocations to defensives
This includes Utilities (XLU, RYU), Consumer Staples (XLP), Health Care (XLV, PPH), and gold miners (GDX).

Late April Break for a 6-Week Decline

Late April capitulation turn unfolding on the SPX trendline break and RTY wedge support breach. We turned bearish (shorting) on April 18 just under SPX 4,200.
A number of breakdown coming through in Asia – Korea’s bear impulse and Taiwan’s break of trendline support that turns the cycle to bearish. Japan will lag.
SPX MACD bear turn is in line with our late April bear phase. A cycle trough is due in 6 weeks time (second week of June).

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Apr 25

Daily Brief Technical Analysis: Tencent Second Rejection – 305 Buy Zone and more

By Smartkarma Daily Briefs | Daily Briefs, Technical Analysis

In today’s briefing:

Tencent Second Rejection – 305 Buy Zone

Tencent Second Rejection – 305 Buy Zone

Tencent’s rally back to the 285 resistance saw a second rejection confirming a b-wave top and our base case call for a C wave slide to the 305 buy support.
Corrective structure to align with RSI low just under 30 as the buy zone. Sell volumes are on the backfoot.
Macro long zone remains at 305/280 to challenge the 385 bull/bear divide. Near resistance at 370.

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Apr 22

Daily Brief Technical Analysis: Taiwan Crack/Red Flag and more

By Smartkarma Daily Briefs | Daily Briefs, Technical Analysis

In today’s briefing:

Taiwan Crack/Red Flag

Taiwan Crack/Red Flag

Taiwan has been a top long but losing bull energy. RSI second support break warns of a price break below pivotal trendline turning our stance from exhaustive to bearish.
Taiwan has been a good hiding place but appears over owned amid waning upside momentum and high conviction RSI bear divergence.
Bearish rising wedge amid divergence are the key chart components to focus on.

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Apr 21

Daily Brief Technical Analysis: HSCEI Stocks to Buy at a Material Discount – Targeted Buying Levels in 2319 HK / 2020 HK / 9888 HK and more

By Smartkarma Daily Briefs | Daily Briefs, Technical Analysis

In today’s briefing:

HSCEI Stocks to Buy at a Material Discount – Targeted Buying Levels in 2319 HK / 2020 HK / 9888 HK
Favor Defensives as S&P 500 Tests 4165-4200; Buys in Consumer Staples & Europe/UK Telecomm

HSCEI Stocks to Buy at a Material Discount – Targeted Buying Levels in 2319 HK / 2020 HK / 9888 HK

At TMA we deliver high probability outcomes by focusing on our 3 pillars of technical analysis. 1) Response to key levels. 2) Price action. 3) Momentum confirmation.
China Mengniu Dairy Co Ltd (2319 HK), ANTA Sports Products Ltd (2020 HK) and Baidu Inc (9888 HK) are all trading at significant discounts to 2023 highs and LT highs.
Today we highlight targeted support levels / buying opportunities in the coming 1-2 days in 2319 HK, 1-3 weeks in 2020 HK and 1-3 months in 9888 HK).

Favor Defensives as S&P 500 Tests 4165-4200; Buys in Consumer Staples & Europe/UK Telecomm