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SG10Y Govt Bond and SPY relationship Part VI - Bear for EquitiesAs mentioned in previous heads up over the last weeks, it had finally happened (as expected) that the SG10Y GB yield rates break out of trend line resistance. And from previous occurrences, this is a very reliable inverse leading indicator of the SPY (and other related equity indexes); meaning that the SPY should be tanking downwards within the next week or so. Enough said, pattern recognition checked, trend correlation checked, projection based on hypothesis checked... now the rubber hits the road. Not expecting any deviation from the correlation, so is very likely that equities should be tipping over in a bearish slide. HEADS UP!
TVC:SG10Y
by Auguraltrader
SINGAPORE STI ETF (EWS) - Royal FlushMultiple signals all aligned to much more downside in the Singapore STI... 1. A lower high. Watch for the lower low incoming! 2. Break out and then break back into the consolidation range. This is the second time, and expect an extrusion through the bottom of the range. 3. MACD lower high, and crossed down. Bearish oops, look from crossing down into bear territory soon. 4. VolDiv crossed down. Targets drawn. On the other hand, the SG10Y bond yield just broke out too. This represents a flight to safety already in the making. Heads up!!!
AMEX:EWSShort
by Auguraltrader
DBS to Gain as Funds Rain in SingaporeDBS is positioned uniquely at the intersection of both India and China to gain from growth in both countries. Facilitating capital flows out of China, continued rising footprint in India, digital asset presence, a trusted bank in Singapore which is emerging as the Swiss of Asia, DBS has more than one source of tailwind powering its upward flight. Specifically, this paper identifies five key drivers powering DBS shares. Against the backdrop of sharp recession ahead, this paper posits a case study delivering 2.8x reward to risk ratio through a spread comprising of long DBS shares and short MSCI Singapore Index futures to gain from expected outperformance. The DBS Story Launched >50 years ago, DBS is the largest bank in South-East Asia and rubbing shoulders among global banks with S$743B in assets as of December 2022. Its diverse services cover consumer banking, asset management, brokerage, and digital assets. DBS' robust capital position, strong governance, and solid operational practices, with MAS as the regulator, makes it a bank with the highest credit ratings in APAC. “Live More, Bank Less” defines the essence of the bank's strategy. DBS aspiration goes beyond being the best bank but aspires to deliver experience that's world class and on par with GANDALF firms. GANDALF stands for Google, Amazon, Netflix, Apple, LinkedIn, and Facebook. And D? DBS, of course. A key figure in the transformation has been its CEO Piyush Gupta who has helmed its leadership since 2009 and is seen as instrumental in the bank's meteoric rise as a global banking player. Last year, DBS delivered stunning record profits of S$8.2B driven by surging rates. 2022 was not entirely hunky dory as fees and commissions declined 12% YoY. DBS expects 2023 to be better with a forecast of double-digit fee income growth plus rising income from cards business. While loan growth slowed with rising rates, DBS continued to gain market share across both corporate and consumer loans. Key growth driver for DBS in 2023 and for the rest of the decade is the wealth migration from China. Singapore is a key destination for capital taking flight out of China. DBS is strongly positioned to take advantage of this as a trusted and customer-focused banking partner. Five factors to propel DBS shares ahead: 1. Chinese Wealth Migration Ultra rich Chinese have been emigrating with Singapore as the preferred destination. China’s crackdown on its business and entrepreneur class with a focus on “common prosperity”. China faced capital flight of about $150B annually from its citizens migrating. Capital flight in 2023 is expected to be far higher, with some estimates suggesting it could top $100-$200B. About 10,800 rich Chinese migrated in 2022, the highest since 2019, according to Henley & Partners. China has the world’s second-largest number of ultra-rich with more than 32,000 people holding wealth more than $50M. DBS holds a key position to capitalize on this trend as the leading and trusted bank in Singapore. It is not just the Chinese but also the wealthy from India, Indonesia and Thailand finding Singapore as a convenient home for them and their wealth. 2. Regional Expansion via Digital First Strategy DBS’s digitization dovetails nicely into their regional expansion as digitised infrastructure easily transcends geography. Case in point is DBS' expansion into India. It had its presence in India since 1994. However, it was with the launch of Digibank India in 2016 that propelled its footprint in the country. Digibank India was the first mobile-only, paperless, signatureless, and branchless bank in India. This allowed them to expand rapidly in the country while India was going through its own financial digitization following demonetization exercise in 2016. This provided DBS with a strong launchpad while keeping operational costs at bay. DBS India has seen its deposits grow consistently since launch with a huge jump following the acquisition of Laxmi Vilas Bank (LVB). Over the past 3 years, DBS India has doubled its revenue. DBS has been profitable since launch, except for a tiny loss in 2017-18. LVB acquisition enabled DBS to expand its branch presence nearly 18x from mere 30 to >500. 3. Bold Forays into Digital Assets In 2020, DBS launched DBS Digital Exchange (DDEx) enabling institutional and accredited investors to access digital assets. With rising regulations for crypto firms, a fully regulated digital exchange like DDEx from a trusted bank such as DBS is a safe haven for digital asset investors. Success of DDEx is evident in its performance in 2022 when BTC trading on the exchange increased 80% YoY. BTC’s custodied on the exchange also doubled while ETH custodied on the exchange increased 60%. DDEx also doubled its customer base to nearly 1,200 last year. 4. Deep Digitisation CEO inspired DBS' purpose driven digital adoption agenda in 2014, with a five-year roadmap and a lofty aim of being named the best bank in the world. DBS approached the challenge by thinking and operating like a major tech firm instead of a bank. It overhauled its internal tech, 90% of which was developed and managed in-house making it cloud-native enabling rapid scaling and easy deployment. DBS pioneered “Digibank,” a mobile only bank that allowed it to scale rapidly and with low cost per retail customer. Digital customers have two times higher income per client compared to traditional clients with cost to income ratio of 34% relative to 54% for traditional clients. 5. Startup Mentality Making Banking Joyful. DBS is deliberate in becoming ever more customer-centric by cleverly tailoring each customer journey to be hassle-free and enjoyable. The bank aims to become “invisible” to its customer while meeting their banking, financial, and investing needs. In instilling a start-up culture, the leadership team continues to cultivate agility, continuous learning, customer obsession, data-driven experimentation and risk-taking across the organisation. DBS Outperforms other Singapore Banks Among top three Singapore Banks: • DBS has the highest ROE at 14.95%. • DBS operating margins of 41.5% are far higher than others. • DBS margins are twice those of OCBC. • DBS grew its Free Cash Flow at 76.5% YoY, far higher than others. • DBS has the lowest P/E ratio making the stock relatively undervalued. • DBS ROIC of 8.2% is marginally lower than OCBC’s 8.75% • DBS asset growth of 8.3% YoY in 2022, lower than UOB’s 9.8%. This puts DBS in a far better financial position than the other Singapore banks. The better performance is also highlighted by DBS stock’s price action. Since Piyush Gupta took over as CEO in 2009, DBS has outperformed OCBC and UOB by an outsized margin and the stock stands nearly 300% higher in the period. Similarly, since the start of 2020, DBS is up 29% and has outperformed the other two banks vindicating its strategy and execution. Comparative Analysis with Other Global Banks DBS shines bright among the global banking majors too as evident below. • DBS has the highest Return on Equity at 15% • DBS has the highest Return on Invested Capital at 8.2% • DBS price to earnings is 6.85 only higher than BNP & Barclays DBS strong operational efficiency stands out even among the top global bank. Additionally, DBS reported 8.3% annual asset growth in 2022, compared to US banks which have had moderate asset growth or decline. Since 2009, DBS stock has far outperformed other major global banks and stands second only to JP Morgan. Notably, DBS has also outperformed the KBW Bank ETF which tracks the performance of US Banks signalling that DBS has been providing stronger growth than the average growth of the US banking industry, particularly during the high-inflation environment of 2022. The trend is even more apparent when looking at the performance of these stocks since the start of 2020. Among the selected banks, DBS is the only bank that has shown strong gains during the pandemic and stands ~30% higher. Other banks have either posted modest gains or losses. In addition to providing strong growth, which is reflected in DBS stock’s price action, DBS also has a strong commitment to returning value to shareholders which can be seen from their nearly 4.1% dividend yield. DBS annual dividend yield has grown by about 100 bps since 2020. Its dividend in 2022 of S$1.5/share exceeded pre-pandemic levels. DBS also announced a special S$0.5/share dividend last quarter reflecting improved earnings profile and strong capital position. 2023 Growth Outlook Analysts expect DBS to continue its meteoric rise, with an average forecast of 15% growth in 2023. Some analysts expect DBS to be 31% higher while even the lowest forecasts are for -11% decline. Key drivers for this growth are expected to be: • Lean operational strategy and structure leading to lower operational costs. • Capital outflows from China. • Regional expansion strategy using their digital banking template. DBS stock has rallied 86% since March 2020, compared to the Straits Times Index which is only 36% higher in the same period. DBS is the largest constituent of the STI and a major driver of growth for Singapore stocks. Overall, DBS bucked the overall trend in the banking sector and provided growth in an immensely challenging environment by focusing on sustainable growth and lower costs. What about the banking crisis? Investing in bank stocks when uncertainty in the sector is so high can be daunting. The collapse of SVB, shuttering of Signature, and acquisition of Credit Suisse has incited turmoil in markets despite central banks stepping in to ease liquidity concerns and avoid contagion. Amid the crisis there has been discussion of loose regulatory practices and risky bets. However, in Singapore, MAS keeps a tight check on the risk management of banks in the country. According to Moody’s, DBS bank still has the highest tier credit ratings and none of its holding are currently under watch. Such stellar ratings suggest that DBS has extremely strong capacity to meet its financial commitments, making it unlikely to be affected by any remaining contagion in the sector. MAS’s strict stewardship of Singapore banks was underscored by a recent outage in DBS digital services. Though the services were promptly restored on the same day, MAS ordered a thorough investigation into the outage. The outage also affected DBS stock price, driving it 1.5% lower but the stock quickly recovered. Both highlight the resilience in the regulatory, operational, and governance practices at DBS. Trade Setup In times of elevated stress, stock betas can spike causing share prices to tank on macroeconomic shocks. To harness pure alpha, this paper posits a spread with long DBS and short MSCI Singapore Index futures. The spread trade ensures that the position remains hedged against a broader market downturn. DBS has outperformed MSCI Singapore index consistently over the past 10 years. MSCI Futures on SGX (SGP1!) give exposure to S$100 x index price which translates into a notional value of S$30,905. On SGX, lot sizes for individual stocks are 100 which means that in order to balance the notional on both legs, 9 lots of DBS shares are required which translates into a notional value of S$30,042. Entry: 10.8% Target Level: 12.5% Stop Level: 10.2% Profit at Target: S$ 4,726 Loss at Stop: S$ 1,671 DISCLAIMER This case study is for educational purposes only and does not constitute investment recommendations or advice. Nor are they used to promote any specific products, or services. Trading or investment ideas cited here are for illustration only, as an integral part of a case study to demonstrate the fundamental concepts in risk management or trading under the market scenarios being discussed. Please read the FULL DISCLAIMER the link to which is provided in our profile description.
SGX:D05Long
by mintdotfinance
SG10Y Govt Bond and SPY relationship Part IIITime for yet another update in this uncanny inverse relationship between the SG10Y Government Bonds and the S&P500 Index ETF, SPY... Recall that the SG10Y GBond yields are in apparent inverse correlation to the SPY. When there is a trendline breakdown on the yields, the SPY is bullish; and when there is a trendline breakout, the SPY is bearish. So far, it can be observed that this relationship is intact and predictable, with the SPY forging bullishly when the SG10Y GBond yields are falling... Note that a support is approaching and this can mean either or both of two things: 1. There should be a brief stall in momentum incoming soon; and 2. The primary trend for the SG10Y GB Yields is bearish, expected to break the support and head further down until the end of April 2023. This also suggests that April should see a surge in the SPY (and S&P500), denoted by the larger green arrow. So far, now change in the yield downtrend, at least for the next week, until it reaches the expected downside target (red circle).
TVC:SG10Y
by Auguraltrader
EURSGDEURSGD - Break out...Coming soon! EURSGD - Technically it's brewing for break out to either direction. We are currently within the ranges of Highs: 1.44965 Lows: 1.41187 If we are to break the lows, expect the recently low areas of 1.37625 to be target areas. If we are to break the hight, expect the the two key resistance areas to be tested and to be target areas 1. 1.47285 & 2. 1.49660 I have even enjoyed trading the USDSGD - very clean set ups! Have a great week ahead, Trade Journal
by Trade_Journal
Singapore Airlines (SIA : C6L) targets $7.00 and attempts to breLong term DOWNTREND SINCE 010908 Medium term UPTREND since 111021 Short term UPTREND since 311022 Singapore Airlines is 1 of 8 component stocks supporting the rise of the STI at the start of 2023. The long signal for this recent run started on 311022 at the price of $5.21. $7.00 is a significant target as it marked the start of last 7 year decline of the stock to a low of $3.20. PIVOT 5.74 Long positions above $5.74 for $7.00 and $8.65 Short positions below $5.74 for $4.89 and $3.20
SGX:C6L
by gekkohot
USDSGD coming back for a retestAfter USDSGD has escaped the ascending channel and the head and shoulders pattern, it is now touching an ascending trend line starting back from Sept 21 and touched again on Feb 22, also touching a 23.6 fib level, currently looking to retest the previous support (neckline) and a 61.8 fib, which is now resistance @1.366, and also the lower channel line. Which was broken earlier. in a 1-hour time frame appears to print a divergence on the RSI indicator, which indicates that we might have a change in the direction -------------------------------- Feel free to share your thoughts in the comments, and kindly support the idea with a like. Your support is greatly appreciated!
Long
by Candlestick_OB
4
EURSGD the best market structure setup in forex!It has been awhile folks but I am back posting ideas on TradingView. I have kept watching and trading the markets everyday since I stopped posting and have had other consulting to do forex and market related. I will be posting ideas on a regular basis. The strategy and set ups remain the same! We look for reversal trades after a long trend. Many Singapore Dollar pairs look good for my technique. EURSGD is a chart I have had on my radar for months, and we finally triggered the breakout on November 16th 2022. Currently, we are in the retest phase of the breakout with buyers stepping in on the retest of new support. What makes EURSGD even more attractive is the fact the chart shows clear signs of market structure. All markets move in three ways: uptrend, range and a downtrend. We clearly have the long downtrend, followed by a range which points to the exhaustion of the downtrend. The breakout of the range means a new uptrend is to begin. We still need our first higher low to confirm this uptrend which leads me to the way of entering the trade. One can enter here on the retest and place the stop loss below the breakout zone. However, just be aware the breakout could turn to a false breakout if we close back below. The more safer way to enter is wait for EURSGD to close above recent highs at 1.4260. This also will confirm the higher low, but more importantly, it increases the probability of a new uptrend. Remember: trading is a business of probabilities! That's it! An uptrend going higher will take us to the next resistance zone of 1.45. Overall, a great risk vs reward set up. There is Singapore CPI on Wednesday which could impact this currency pair. AUDSGD is another Singapore Dollar pair with a nice reversal setup as well.
ELong
by Uncharted-FX
1
DBS rallies ahead of tomorrow's earnings reportThe stock has been performing well ahead of its earnings reports, thanks to the news that DBS will be the bank to utilise MaxxDigital – a digital asset platform that provides risk and FX solutions for institutions. Whilst Singapore’s regulators continue to clamp down on crypto trading for retailers, Singapore wants to become a digital-asset hub within the financial sector – and this could be the first step of many which help them do just that. DBS rose 3.6% on Friday following the announcement and has extended those gains to around 6% at the time of writing from Friday’s low. According to Reuters, 13 analysts recommend DBS stock for a ‘buy’ (4 of which are a strong buy) with 4 holds and no sell recommendations. The stock currently trades at 34.58 and has a median price target of 39.11 (+13%). DBS Daily Chart: The daily chart shows that DBS performed a strong breakout (with high volume) from its sideways range after prices found support at the 200-day and 50-day EMA’s. And that suggests it could be part of the bullish trend from the July low. However, there are a couple of warning signs that it may need to retrace a little before continuing higher. A bearish pinbar formed on Monday with low volume, and yesterday’s price action struggling to convincingly push higher. Gap resistance, $35 and the monthly R1 pivot point are nearby and RSI (2) is overbought - which can indicate a near-term turning point. With that said, the RSI(14) is over 50 and trending higher with prices, which is another reason we suspect any move lower is part of a retracement before prices head for the high around 36.30. Of course, earnings can be full of surprises and we may need to see DBS beat estimates for it to trade directly higher. Otherwise – assuming earnings is not too disappointing – it could help with a desired pullback, where we would seek bullish setups around the monthly pivot / prior breakout range.
SGX:D05Long
by CityIndex
SINGAPORE & INDONESIA COVID-19 WavesWas in a number of private discussions over this week, and noted that there appears to be some dynamics in motion currently. Quick note that the Singapore 6th COVID wave is pretty turned over, according to the data provided publicly. It was a smaller wave compared to previously, as expected. However, the neighbouring Indonesia is currently in the midst of a wave and by similar projections (if relevant), the wave should peak out over the next two weeks ending November. Just an observation to share... PS. Apologies, I don't know why the chart looks so messy... it published differently, pre-cleaning up. Just look at the MACD curves and about 78% of the previous wave (MACD) as the target point for Indonesia wave to peak out.
C
by Auguraltrader
Singapore STI ETF (EWS) signals a rough 2022The Singapore bourse STI ETF, EWS, has a very ominous outlook for the next couple of months into the end of 2022. Hyperinflation could be the current trending killer, but seems like more is likely to add on. Not sure what shoe will drop, but the charts tell it as it is... April and May ended badly entering into a range that saw May break down of that range briefly. The monthly technicals are showing a lot of underlying weakness, and the first downside target is shown. The lower range band must hold, and is quite likely to be tested and should hold (at least seen at this point). Otherwise, a low more downside will ensue... Heads up for the next half of 2022 Singapore!
AMEX:EWS
by Auguraltrader
SINGAPORE COVID-19 Wave 6I do not know the robustness of the data collected, as it differs greatly in different places. But with just a quick comparison: Singapore relaxed mask measures on 29 August, and from early September, there was already an uptick and the MACD histograms pointed out to late September crossover. Indeed, on 30 September, CNA reported a 40% week on week increase in COVID-19 cases. This wave/spike appears to be much less steep than the previous in June 2022. Nonetheless, with the F1 weekend happening, we might get a continuation of the spike for the month of October into November... a smaller but longer wave. Demonstrates yet again that the MACD histograms have an edge in projecting the time line to a spike in cases. IF only the people know about such a simple and yet effective tool. In the same comparison, the UK appears to have tapered down after a recent spike. However, noted that the daily numbers are actually weekly numbers. Demonstrates the robustness of data for reliability. Indonesia looks to be tapering off too, but Malaysia appears to be looking at a crossover by mid-October for a wave, albeit a smaller wave. Really, IF anyone still cares enough...
C
by Auguraltrader