Technical Analyst, Saxo Bank
Summary: Sea Ltd gapping lower demolishing and reversing the bullish trend. The technical picture suggests price levels below 60 are not unlikely
Sea Ltd – ADR gapped lower yesterday after earnings. It came after the share price once again failed to break above strong resistance are at around 89.55
The sell-off yesterday pushed the share price below the short-term rising trendline and has reverse the uptrend to a confirmed downtrend. Sea is below the Ichimoku Cloud which is a sign of underlying bearish trend and RSI closed yesterday below 40 threshold i.e., negative strength sentiment indicating likely lower Sea levels.
Sellers are likely to try closing the gap from March i.e., a move to support at around 65.67 and the 200 daily Moving Average
Medium-term Sea is testing slightly rising trend and seems to be continuing the Bubble pattern collapse.
If breaking below the lower rising trendline Sea is likely to drop to 57.95 , possibly lower. Bulls can, however, cling their hopes to the weekly RSI that is still showing positive sentiment. However, RSI has broken below its risisng trendline and if closing a week below the trendline it is an indication RSI is likely to test the 40 threshold.
If the weekly RSI is closing a week below 40 and a price close below 57.95, it can send Sea into a tailspin to test November 2022 low at around 40.67
To reverse this bearish picture a close above 89.55 is needed.
A close of the gap from yesterday would be first indication of that scenario to play out.
2024: The wasted year
Markets are driven by election optimism, overshadowing growing debt and liquidity concerns. The 2024 elections loom large, but economic fundamentals and debt issues warrant cautious investment.
As US economic slowdown hints at a shift away from exceptionalism, USD faces downside with looming Fed cuts. AUD and NZD set to outperform as their rate cuts lag. JPY gains on carry unwind bets and BOJ pivot.
Amid AI and obesity drug excitement, equities see varied prospects: neutral on overvalued US stocks, negative on Japan due to JPY risks, positive on Europe. European defence stocks gain appeal.
With the economic slowdown, quality assets will gain favour, especially sovereign bonds up to 5 years. Central banks' potential rate cuts in Q2 suggest extending duration, despite policy and inflation concerns.
Commodities poised for rebound. The "Year of the Metal" boosts gold and silver, copper awaits rate cuts. Grains may recover, natural gas stabilises. Gold targets $2,300-$2,500/oz, copper's breakout could signal growth.
Markets are driven by election optimism, overshadowing growing debt and liquidity concerns. The 2024 elections loom large, but economic fundamentals and debt issues warrant cautious investment.
As US economic slowdown hints at a shift away from exceptionalism, USD faces downside with looming Fed cuts. AUD and NZD set to outperform as their rate cuts lag. JPY gains on carry unwind bets and BOJ pivot.
Amid AI and obesity drug excitement, equities see varied prospects: neutral on overvalued US stocks, negative on Japan due to JPY risks, positive on Europe. European defence stocks gain appeal.
With the economic slowdown, quality assets will gain favour, especially sovereign bonds up to 5 years. Central banks' potential rate cuts in Q2 suggest extending duration, despite policy and inflation concerns.
Commodities poised for rebound. The "Year of the Metal" boosts gold and silver, copper awaits rate cuts. Grains may recover, natural gas stabilises. Gold targets $2,300-$2,500/oz, copper's breakout could signal growth.