Singapore Exchange – Tick Insights

Singapore Exchange Stock code S68.SGX

Outlook

Price has declined on the news that HK Exchange and Clearing LTD has signed an agreement with MSCI to offer futures contracts on the MSCI China A Index, giving global investors a tool to hedge their investment in Asia’s largest equity market. This could divert trading of SGX’s FTSE China A50 index futures contracts to Hong Kong. SGX’s China A50 is currently the only futures contract tracking China’s A shares. The China A50 futures contract is SGX Derivatives top active contract with 7.49M contacts traded in the month of Jan 2019. This volume is almost 54% of the total equity index futures volume of 13.77M in the month of Jan 2019. Should Hong Kong manage to divert 50% of this volume away from SGX; it would be a huge drain on SGX’s revenue and profitability. Price has broken below the support at $7.50 and the next strong support is at $7.00. For technical analysis, please refer to 8^th Mar 2019 CFD Trading Note.

Strategy

$7.52 Short Sell
$7.00 Price Target
$7.82 Risk Management Stop
3 weeks Trade Duration

Hong Kong Exchange Code 0388.HKE

Outlook

Price found support at HK264.00, which was the gap of 2 candles body. With news of its impending launch of MSCI China A Index, price has gone up by HK5.60 yesterday. Currently price trend is strong as the gradient of price advance has been steep. Price is currently above the cloud and the Base line, which are signs of a bullish trend. MACD has not shown any divergence warning of a high as yet. Both MACD lines are far away from and above the zero line, which is a hint of a strong trend. It means price could go higher to the next resistance point at HK292.00

Strategy

HK272.00 Buy
HK292.00 Price Target
HK263.90 Risk Management Stop
3 weeks Trade Duration

Singapore Exchange Stock code S68.SGX

Outlook

Price reached a bottom on the 30th of Oct at $6.52 and had advanced to a high of $8.05 on the 5th of Mar 2019. There was an Inverse Head and Shoulder chart pattern and its target was close to the recent price high. The rally since late Oct could be ending. There was a Hanging Man candlestick pattern 2 days ago that was followed by a big red candle the next day. Hanging Man is a reversal pattern. MACD has been showing weaker movement while price rallied. There was also a bearish divergence warning given by MACD. We think the price rally has probably ended. We think price is likely to decline to $7.52, which is the Fibonacci 50% correction point of the rally from $7.00 to $8.05.

Strategy

$7.92 Short Sell
$7.52 Price Target
$8.06 Risk Management Stop
2 weeks Trade Duration

Tencent Stock Code 700.HKE

Outlook

Price reached a bottom on 30^th Oct 2018 at HK251.40. Since the low, a rally brought price to HK370 on 6^th Mar 2019. The high of HK370 was just above the Fibonacci 50% of the decline from HK475.60 in Mar 2018 to Oct 2018 low of HK251.40. It was also below the key resistance of HK388.80. This could be a sign that the recent rally has ended. The day after the high was a big red candle that was almost twice the size of the previous day. MACD is showing bearish divergence warning of a possible top in the making.

Strategy

HK355.00 Short Sell
HK320.00 Price Target
HK371.00 Risk Management Stop
2 weeks Trade Duration