SG SESSION (Establishment of Short Term Uptrend Channel)
The Straits Times Index (STI) retraces -0.3% (-8.14 points) during the week, as forecasted during the previous week outlook. At current junction, STI has established a short term uptrend channel.
The levels to watch for the week is 2,900 immediate resistance level, along with lower trendline support level at 2,760 for the intact of this uptrend channel.
US SESSION (Double Bottom Formation Breakout In Play)
The S&P500 rallied +1.1% (+22.2 points) during the week. As highlighted last week, S&P successful breakup of a trend reversal Double Bottom Formation (Bullish) is currently still in works. Do note that the past 2 weeks of rally has established a bearish divergence against both indicators (MACD & RSI), along with volume as well. This signifies potential weakness to be played out in the near term.
The levels to watch for the week is 2085 immediate major resistance level. The immediate major support zone to watch is 1,940 level, resistance turned support level.
5 things to watch on the economic calendar this week
1. Fed rate decision (Wednesday)
Fed Chair Janet Yellen is to hold what will be a closely-watched press conference 30 minutes after the release of the Fed’s statement, as investors look for any change in tone about the economy or future rate hikes.
Many in the market anticipate the pace of increases to be gradual amid concerns over tepid growth overseas and divergent monetary policies between the U.S. and other nations.
2. BOJ policy announcement (Tuesday)
The BOJ is widely expected to stand pat on monetary policy after January’s shock decision to adopt negative rates, but some speculate it could still cut rates deeper into negative territory as part of its ongoing effort to reflate a stagnant economy.
3. Bank of England “Super Thursday” (Thursday)
Last month, the Monetary Policy Committee voted 9-0 to keep rates on hold at a record low 0.5%.
Expectations for a rate hike by the BOE have been recently pushed back to early-2017 due uncertainty over a June referendum on whether or not Britain should stay in the European Union.
4. SNB policy assessment (Thursday)
Most economists expect the central bank’s benchmark interest rate to remain unchanged at -0.75%, despite speculation it may move further into negative territory following the European Central Bank’s aggressive easing last week.
The SNB will also issue updated growth and inflation forecasts.
5. U.S. retail sales, CPI data (Tuesday)
The consensus forecast is that the report will show retail sales fell 0.1% last month, after gaining 0.2% in January. Core sales are forecast to decline 0.2%, after rising 0.1% a month earlier.
On Wednesday, the U.S. will publish February inflation figures at 12:30GMT, or 8:30AM ET. Market analysts expect consumer prices to post a decline of 0.2%, while core inflation is forecast to increase 0.2%.