Technical Analysis

In this briefing:

1. Tsuruha Holdings/Toyota Motor Pair on a Stronger JPY
2. DBS Sell Barrier Within Decline Call
3. Dollar Yen BIG Short Phase II
4. U.S. Equity Strategy: Oversold Rally Continues
5. Samsung Bear Targets Coming into Focus

1. Tsuruha Holdings/Toyota Motor Pair on a Stronger JPY

Running thorough ideas presented by Campbell Gunn in his stronger yen insight Japan: What to Buy & Sell if the ¥ Rises to 90 , we found a compelling pair trade set up in the form of long Tsuruha Holdings (3391 JP) and short Toyota Motor (7203 JP) as the relative chart is moving into an exhaustive low that sets up a good reaction rise to the tune of 20%.

In absolute terms we see Toyota Motor moving into a top while Tsuruha shows risk of a final low to work into this pair position but has a very compelling bullish chart set up as Toyota fade from resistance.

2. DBS Sell Barrier Within Decline Call

This is a follow up with fresh levels from our insight DBS Top and Decline Call to See More Fallout in 2019 .

Descending price wedge has and will dominate tactical swing cycles on the way down with fresh evidence of a bearish flat maturing and a tactical negative to test the lower end of the descending range. DBS is knocking on fresh sell resistance currently.

Relative stance also shows continued deterioration versus the STI barring an upside break of pattern resistance. Expected bottoming cycle due in May 2019 followed by a perform into year-end.

Indicator bear divergences are being unwound but we are starting to see basing bull divergence form in the daily MACD cycle.

3. Dollar Yen BIG Short Phase II

Major top and short call at USD/JPY 114 and flash decline did have a direct impact on a risk assets and the Nikkei in line with our S&P and Nikkei short calls. The second phase of USD/JPY weakness will usher in the next downturn in risk assets in late Q1 after some tactical posturing. We do view SPX 2,600 as a good level to re cycle shorts with some range work in store for February.

High degree divergence is still not fully unwound and implies the USD/JPY is set for a new low and part of phase II of the pain trade. Japan’s Crowded Long Faces Exodus Pressure . Japan Bank Index Bearish Head and Shoulders .

JPY crosses versus the AUD, GBP and Euro are currently nudging up against key resistance points that represent an interesting pivot point to stage a fresh decline (good risk aversion barometers).

We are seeing the knock on effect in Asian FX.

USD/JPY will surpass our original downside target of 108-109.

4. U.S. Equity Strategy: Oversold Rally Continues

A combination of, optimism surrounding U.S.-China trade talks, and Fed Chairman Powell’s comments have led to a continuation of the oversold bounce which began on 12/26, and the S&P 500 is now trading just below the 12/19 pre-Fed rate hike area. ~2,350 on the S&P 500 remains the support level to monitor. A retest of this low remains the most likely scenario, though it is far from a guarantee due to the potential for a “V” reversal. We examine an array of factors leading to our intact cautious outlook, and highlight attractive set-ups within Consumer Discretionary and Health Care Sectors.

5. Samsung Bear Targets Coming into Focus

Samsung Electronics (005930 KS) bear call from 50k has rewarded with a series of short trades with the most recent short from 46k and has sliced through support at 39,500. Impulsive nature of the decline tell us a key low will take more time to take shape.

SEC is pressing on critical relative support versus the Kospi. A break would send ripples through the broader market in terms of the direction bias. Kospi has already spent far too much time below the macro pivot barrier at 272k for signs of any immediate recovery. Risk lies with a downside overshoot below 250 support for the Kospi.

SEC is completing a minute full wave count down that sets up a counter trend bounce which is tradable but the major low remains elusive. We outline probable downside targets in late Q1/Q2, upside cap into Q3 and the more strategic buy support.

In this briefing:

1. Naver Bull Wedge to Trade Higher
2. Japan Bank Index Bearish Head and Shoulders

1. Naver Bull Wedge to Trade Higher

After an impulsive rise from the 110.5k dual bottom, Naver Corp (035420 KS) has formed a bull wedge that is expected to see a nice rally and perform over the Korean market.

RSI also shows a compelling set up for a rise.

Buy volumes are starting to improve and supportive.

Targets are 8% and 14% higher from current levels.

Macro pivot resistance will cap rally attermpts in Q1.

2. Japan Bank Index Bearish Head and Shoulders

Japanese banks telegraphed the Nikkei plunge as did our insight on the USD/JPY Dollar Yen BIG Short/Inflection Level and Targets .

We flagged a bearish Nikkei cycle in Japan’s Crowded Long Faces Exodus Pressure.

Japan bank index exhibits are very clear bearish head and shoulder pattern that broke neckline support and will offer a great short into a bounce for further weakness. This warns of further deterioration in the Nikkei post uptick.

In this briefing:

1. DBS Sell Barrier Within Decline Call
2. Dollar Yen BIG Short Phase II
3. U.S. Equity Strategy: Oversold Rally Continues
4. Samsung Bear Targets Coming into Focus
5. Naver Bull Wedge to Trade Higher

1. DBS Sell Barrier Within Decline Call

This is a follow up with fresh levels from our insight DBS Top and Decline Call to See More Fallout in 2019 .

Descending price wedge has and will dominate tactical swing cycles on the way down with fresh evidence of a bearish flat maturing and a tactical negative to test the lower end of the descending range. DBS is knocking on fresh sell resistance currently.

Relative stance also shows continued deterioration versus the STI barring an upside break of pattern resistance. Expected bottoming cycle due in May 2019 followed by a perform into year-end.

Indicator bear divergences are being unwound but we are starting to see basing bull divergence form in the daily MACD cycle.

2. Dollar Yen BIG Short Phase II

Major top and short call at USD/JPY 114 and flash decline did have a direct impact on a risk assets and the Nikkei in line with our S&P and Nikkei short calls. The second phase of USD/JPY weakness will usher in the next downturn in risk assets in late Q1 after some tactical posturing. We do view SPX 2,600 as a good level to re cycle shorts with some range work in store for February.

High degree divergence is still not fully unwound and implies the USD/JPY is set for a new low and part of phase II of the pain trade. Japan’s Crowded Long Faces Exodus Pressure . Japan Bank Index Bearish Head and Shoulders .

JPY crosses versus the AUD, GBP and Euro are currently nudging up against key resistance points that represent an interesting pivot point to stage a fresh decline (good risk aversion barometers).

We are seeing the knock on effect in Asian FX.

USD/JPY will surpass our original downside target of 108-109.

3. U.S. Equity Strategy: Oversold Rally Continues

A combination of, optimism surrounding U.S.-China trade talks, and Fed Chairman Powell’s comments have led to a continuation of the oversold bounce which began on 12/26, and the S&P 500 is now trading just below the 12/19 pre-Fed rate hike area. ~2,350 on the S&P 500 remains the support level to monitor. A retest of this low remains the most likely scenario, though it is far from a guarantee due to the potential for a “V” reversal. We examine an array of factors leading to our intact cautious outlook, and highlight attractive set-ups within Consumer Discretionary and Health Care Sectors.

4. Samsung Bear Targets Coming into Focus

Samsung Electronics (005930 KS) bear call from 50k has rewarded with a series of short trades with the most recent short from 46k and has sliced through support at 39,500. Impulsive nature of the decline tell us a key low will take more time to take shape.

SEC is pressing on critical relative support versus the Kospi. A break would send ripples through the broader market in terms of the direction bias. Kospi has already spent far too much time below the macro pivot barrier at 272k for signs of any immediate recovery. Risk lies with a downside overshoot below 250 support for the Kospi.

SEC is completing a minute full wave count down that sets up a counter trend bounce which is tradable but the major low remains elusive. We outline probable downside targets in late Q1/Q2, upside cap into Q3 and the more strategic buy support.

5. Naver Bull Wedge to Trade Higher

After an impulsive rise from the 110.5k dual bottom, Naver Corp (035420 KS) has formed a bull wedge that is expected to see a nice rally and perform over the Korean market.

RSI also shows a compelling set up for a rise.

Buy volumes are starting to improve and supportive.

Targets are 8% and 14% higher from current levels.

Macro pivot resistance will cap rally attermpts in Q1.

In this briefing:

1. Japan Bank Index Bearish Head and Shoulders

1. Japan Bank Index Bearish Head and Shoulders

Japanese banks telegraphed the Nikkei plunge as did our insight on the USD/JPY Dollar Yen BIG Short/Inflection Level and Targets .

We flagged a bearish Nikkei cycle in Japan’s Crowded Long Faces Exodus Pressure.

Japan bank index exhibits are very clear bearish head and shoulder pattern that broke neckline support and will offer a great short into a bounce for further weakness. This warns of further deterioration in the Nikkei post uptick.

In this briefing:

1. Dollar Yen BIG Short Phase II
2. U.S. Equity Strategy: Oversold Rally Continues
3. Samsung Bear Targets Coming into Focus
4. Naver Bull Wedge to Trade Higher
5. Japan Bank Index Bearish Head and Shoulders

1. Dollar Yen BIG Short Phase II

Major top and short call at USD/JPY 114 and flash decline did have a direct impact on a risk assets and the Nikkei in line with our S&P and Nikkei short calls. The second phase of USD/JPY weakness will usher in the next downturn in risk assets in late Q1 after some tactical posturing. We do view SPX 2,600 as a good level to re cycle shorts with some range work in store for February.

High degree divergence is still not fully unwound and implies the USD/JPY is set for a new low and part of phase II of the pain trade. Japan’s Crowded Long Faces Exodus Pressure . Japan Bank Index Bearish Head and Shoulders .

JPY crosses versus the AUD, GBP and Euro are currently nudging up against key resistance points that represent an interesting pivot point to stage a fresh decline (good risk aversion barometers).

We are seeing the knock on effect in Asian FX.

USD/JPY will surpass our original downside target of 108-109.

2. U.S. Equity Strategy: Oversold Rally Continues

A combination of, optimism surrounding U.S.-China trade talks, and Fed Chairman Powell’s comments have led to a continuation of the oversold bounce which began on 12/26, and the S&P 500 is now trading just below the 12/19 pre-Fed rate hike area. ~2,350 on the S&P 500 remains the support level to monitor. A retest of this low remains the most likely scenario, though it is far from a guarantee due to the potential for a “V” reversal. We examine an array of factors leading to our intact cautious outlook, and highlight attractive set-ups within Consumer Discretionary and Health Care Sectors.

3. Samsung Bear Targets Coming into Focus

Samsung Electronics (005930 KS) bear call from 50k has rewarded with a series of short trades with the most recent short from 46k and has sliced through support at 39,500. Impulsive nature of the decline tell us a key low will take more time to take shape.

SEC is pressing on critical relative support versus the Kospi. A break would send ripples through the broader market in terms of the direction bias. Kospi has already spent far too much time below the macro pivot barrier at 272k for signs of any immediate recovery. Risk lies with a downside overshoot below 250 support for the Kospi.

SEC is completing a minute full wave count down that sets up a counter trend bounce which is tradable but the major low remains elusive. We outline probable downside targets in late Q1/Q2, upside cap into Q3 and the more strategic buy support.

4. Naver Bull Wedge to Trade Higher

After an impulsive rise from the 110.5k dual bottom, Naver Corp (035420 KS) has formed a bull wedge that is expected to see a nice rally and perform over the Korean market.

RSI also shows a compelling set up for a rise.

Buy volumes are starting to improve and supportive.

Targets are 8% and 14% higher from current levels.

Macro pivot resistance will cap rally attermpts in Q1.

5. Japan Bank Index Bearish Head and Shoulders

Japanese banks telegraphed the Nikkei plunge as did our insight on the USD/JPY Dollar Yen BIG Short/Inflection Level and Targets .

We flagged a bearish Nikkei cycle in Japan’s Crowded Long Faces Exodus Pressure.

Japan bank index exhibits are very clear bearish head and shoulder pattern that broke neckline support and will offer a great short into a bounce for further weakness. This warns of further deterioration in the Nikkei post uptick.

In this briefing:

1. Apple Pain Trade Continues with Key Levels in Focus
2. SPX and Asia Bear Kick Off

1. Apple Pain Trade Continues with Key Levels in Focus

Following up on our August 2018 AAPL sell call and our insight Apple Trend Fractures but Nearing Tactical Buy Support with a Bumpy Road Ahead. Our core bear thesis for tech from the summer of 2018 is playing out and still has more pain left until we reach key target levels in late Q1 2019.

Sell rally attempts was the bet/call.

Break below 160 support was pivotal.

Core macro bear bias remains toward the higher degree 50% retracement.

Near term down cycle looking increasingly oversold and reaching for our target support outlined in charts and in the previous insight.

Will be watching sell volume on today’s miss.

2. SPX and Asia Bear Kick Off

A brief positioning sequence update as trade kicks off for 2019. Our S&P bounce sequence outlined after Christmas met our C wave target and now set for some tactical ranging before reach for new lows in Q1.

The fact that Asia could not must a rally on the back of the US 5% move higher on December 26th shed light on the bias this is resuming today after flat range patterns are breaking down.

Sell rallies remains our macro bias, however we see a tactical low shaping up next week in part of a range bounce flat pattern ahead of the bigger bear cycle due into late Q1.

Asia base case downside targets are outlined as well as fresh short resistance levels.

In this briefing:

1. Samsung Bear Targets Coming into Focus
2. Naver Bull Wedge to Trade Higher
3. Japan Bank Index Bearish Head and Shoulders
4. Global Equity Strategy: Bearish with the Exception of EM.
5. Bearish U.S. Outlook Intact

1. Samsung Bear Targets Coming into Focus

Samsung Electronics (005930 KS) bear call from 50k has rewarded with a series of short trades with the most recent short from 46k and has sliced through support at 39,500. Impulsive nature of the decline tell us a key low will take more time to take shape.

SEC is pressing on critical relative support versus the Kospi. A break would send ripples through the broader market in terms of the direction bias. Kospi has already spent far too much time below the macro pivot barrier at 272k for signs of any immediate recovery. Risk lies with a downside overshoot below 250 support for the Kospi.

SEC is completing a minute full wave count down that sets up a counter trend bounce which is tradable but the major low remains elusive. We outline probable downside targets in late Q1/Q2, upside cap into Q3 and the more strategic buy support.

2. Naver Bull Wedge to Trade Higher

After an impulsive rise from the 110.5k dual bottom, Naver Corp (035420 KS) has formed a bull wedge that is expected to see a nice rally and perform over the Korean market.

RSI also shows a compelling set up for a rise.

Buy volumes are starting to improve and supportive.

Targets are 8% and 14% higher from current levels.

Macro pivot resistance will cap rally attermpts in Q1.

3. Japan Bank Index Bearish Head and Shoulders

Japanese banks telegraphed the Nikkei plunge as did our insight on the USD/JPY Dollar Yen BIG Short/Inflection Level and Targets .

We flagged a bearish Nikkei cycle in Japan’s Crowded Long Faces Exodus Pressure.

Japan bank index exhibits are very clear bearish head and shoulder pattern that broke neckline support and will offer a great short into a bounce for further weakness. This warns of further deterioration in the Nikkei post uptick.

4. Global Equity Strategy: Bearish with the Exception of EM.

Our cautious outlook and expectation for continued downward consolidation for global equities remains intact. Broad global indexes (MSCI ACWI, ACWI ex-U.S., EAFE, and EM) are all trading within patterns of lower highs and lower lows, leading us to believe the most likely scenario is that this near-term bounce is likely nothing more than a countertrend rally before longer-term downtrends reassert themselves. The one bright spot is EM.  In this report we highlight a number of attractive set-ups within the Financial, Communication, Engineering & Construction, and Transportation Sectors.

5. Bearish U.S. Outlook Intact

Wednesday’s rally in U.S. equities was likely nothing more than a brief bear market rally, as confirmed by Thursday’s sell-off.  All the major averages remain in downtrends and there continues to be an absence of bottoming patterns. Concerns that we have highlighted over the past several months continue to lead us to our intact cautious outlook.  In this report we highlight important technical levels and indicators, and highlight a bright spot for investors within the Consumer Staples Sector.

In this briefing:

1. Naver Bull Wedge to Trade Higher
2. Japan Bank Index Bearish Head and Shoulders
3. Global Equity Strategy: Bearish with the Exception of EM.
4. Bearish U.S. Outlook Intact
5. Apple Pain Trade Continues with Key Levels in Focus

1. Naver Bull Wedge to Trade Higher

After an impulsive rise from the 110.5k dual bottom, Naver Corp (035420 KS) has formed a bull wedge that is expected to see a nice rally and perform over the Korean market.

RSI also shows a compelling set up for a rise.

Buy volumes are starting to improve and supportive.

Targets are 8% and 14% higher from current levels.

Macro pivot resistance will cap rally attermpts in Q1.

2. Japan Bank Index Bearish Head and Shoulders

Japanese banks telegraphed the Nikkei plunge as did our insight on the USD/JPY Dollar Yen BIG Short/Inflection Level and Targets .

We flagged a bearish Nikkei cycle in Japan’s Crowded Long Faces Exodus Pressure.

Japan bank index exhibits are very clear bearish head and shoulder pattern that broke neckline support and will offer a great short into a bounce for further weakness. This warns of further deterioration in the Nikkei post uptick.

3. Global Equity Strategy: Bearish with the Exception of EM.

Our cautious outlook and expectation for continued downward consolidation for global equities remains intact. Broad global indexes (MSCI ACWI, ACWI ex-U.S., EAFE, and EM) are all trading within patterns of lower highs and lower lows, leading us to believe the most likely scenario is that this near-term bounce is likely nothing more than a countertrend rally before longer-term downtrends reassert themselves. The one bright spot is EM.  In this report we highlight a number of attractive set-ups within the Financial, Communication, Engineering & Construction, and Transportation Sectors.

4. Bearish U.S. Outlook Intact

Wednesday’s rally in U.S. equities was likely nothing more than a brief bear market rally, as confirmed by Thursday’s sell-off.  All the major averages remain in downtrends and there continues to be an absence of bottoming patterns. Concerns that we have highlighted over the past several months continue to lead us to our intact cautious outlook.  In this report we highlight important technical levels and indicators, and highlight a bright spot for investors within the Consumer Staples Sector.

5. Apple Pain Trade Continues with Key Levels in Focus

Following up on our August 2018 AAPL sell call and our insight Apple Trend Fractures but Nearing Tactical Buy Support with a Bumpy Road Ahead. Our core bear thesis for tech from the summer of 2018 is playing out and still has more pain left until we reach key target levels in late Q1 2019.

Sell rally attempts was the bet/call.

Break below 160 support was pivotal.

Core macro bear bias remains toward the higher degree 50% retracement.

Near term down cycle looking increasingly oversold and reaching for our target support outlined in charts and in the previous insight.

Will be watching sell volume on today’s miss.

In this briefing:

1. Global Equity Strategy: Bearish with the Exception of EM.
2. Bearish U.S. Outlook Intact
3. Apple Pain Trade Continues with Key Levels in Focus
4. SPX and Asia Bear Kick Off

1. Global Equity Strategy: Bearish with the Exception of EM.

Our cautious outlook and expectation for continued downward consolidation for global equities remains intact. Broad global indexes (MSCI ACWI, ACWI ex-U.S., EAFE, and EM) are all trading within patterns of lower highs and lower lows, leading us to believe the most likely scenario is that this near-term bounce is likely nothing more than a countertrend rally before longer-term downtrends reassert themselves. The one bright spot is EM.  In this report we highlight a number of attractive set-ups within the Financial, Communication, Engineering & Construction, and Transportation Sectors.

2. Bearish U.S. Outlook Intact

Wednesday’s rally in U.S. equities was likely nothing more than a brief bear market rally, as confirmed by Thursday’s sell-off.  All the major averages remain in downtrends and there continues to be an absence of bottoming patterns. Concerns that we have highlighted over the past several months continue to lead us to our intact cautious outlook.  In this report we highlight important technical levels and indicators, and highlight a bright spot for investors within the Consumer Staples Sector.

3. Apple Pain Trade Continues with Key Levels in Focus

Following up on our August 2018 AAPL sell call and our insight Apple Trend Fractures but Nearing Tactical Buy Support with a Bumpy Road Ahead. Our core bear thesis for tech from the summer of 2018 is playing out and still has more pain left until we reach key target levels in late Q1 2019.

Sell rally attempts was the bet/call.

Break below 160 support was pivotal.

Core macro bear bias remains toward the higher degree 50% retracement.

Near term down cycle looking increasingly oversold and reaching for our target support outlined in charts and in the previous insight.

Will be watching sell volume on today’s miss.

4. SPX and Asia Bear Kick Off

A brief positioning sequence update as trade kicks off for 2019. Our S&P bounce sequence outlined after Christmas met our C wave target and now set for some tactical ranging before reach for new lows in Q1.

The fact that Asia could not must a rally on the back of the US 5% move higher on December 26th shed light on the bias this is resuming today after flat range patterns are breaking down.

Sell rallies remains our macro bias, however we see a tactical low shaping up next week in part of a range bounce flat pattern ahead of the bigger bear cycle due into late Q1.

Asia base case downside targets are outlined as well as fresh short resistance levels.

In this briefing:

1. SPX and Asia Bear Kick Off

1. SPX and Asia Bear Kick Off

A brief positioning sequence update as trade kicks off for 2019. Our S&P bounce sequence outlined after Christmas met our C wave target and now set for some tactical ranging before reach for new lows in Q1.

The fact that Asia could not must a rally on the back of the US 5% move higher on December 26th shed light on the bias this is resuming today after flat range patterns are breaking down.

Sell rallies remains our macro bias, however we see a tactical low shaping up next week in part of a range bounce flat pattern ahead of the bigger bear cycle due into late Q1.

Asia base case downside targets are outlined as well as fresh short resistance levels.