October 2023

ICE Futures Singapore Monthly Report

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MACRO COMMENTARY

The MINI U.S. DOLLAR INDEX ® FUTURES (SDX) surged to reach a new 2023 high at 106.72, during early October trading. However, the SDX later retraced, to close at 105.80 as demand for the U.S. Dollar struggled to sustain further upward momentum. The SDX closed October with a small loss of 0.02%.

  • Nonfarm Payrolls surprised the markets when 297,000 new jobs were added in September (adjusted at November release from 336,000), surpassing expectations of 170,000 and raising the likelihood of a possible rate rise before the year end. August data was upwardly revised to 227,000 jobs from 187,000 previously reported. The SDX closed with a loss of 0.26% at 105.79.
  • The FOMC Minutes revealed that policymakers reached a consensus that monetary policy should maintain a restrictive stance for longer, pending stronger evidence that inflation is moving closer to the 2% target. While there was some uncertainty regarding whether interest rates should see one more increase by the end of the year, the majority of policymakers leaned in favor of this action, dependent on forthcoming economic data releases. The benchmark Federal Funds rate is in a range of 5.25% - 5.50%, the highest in 22 years. The SDX closed the day at 105.57 with a modest gain of 0.01%.
  • Core Inflation (all items less food and energy) eased as expected for the period 12-month ending September to 4.1% from 4.3% the prior month, the lowest rate since September 2021. The SDX closed with a gain of 0.76% at 106.37, the strongest daily performance of the month.

The COINDESK BITCOIN FUTURES (BMC) broke the $32,000 level in a strong move on October 23rd, having traded between the $24,000 to $32,000 range since April 2023. The contract closed the month 27.5% higher at $34,687 versus the prior month's close. Bitcoin will need to maintain closes above the $25,000 level and set higher lows to indicate a continuation of an uptrend in price.

  • Companies like Zodia Custody, operating in the digital asset infrastructure sector, are actively expanding into new markets that aim to create conducive ecosystems for the growth of digital asset-driven enterprises. Zodia has recently initiated its services in Hong Kong, capitalizing on the considerable institutional demand for digital assets in the country. Notably, Zodia counts Standard Chartered Bank, Northern Trust, and SBI Holdings among its owners, underscoring the commitment of established financial institutions to invest in this technology.

The MICRO ASIA TECH 30 INDEX FUTURES (ATI) continued to set another lower-high in mid-October below $3,250, and a lower-low around $3,000. The index closed the month at $3,019 (4.0% lower) versus September, following weak performance in most global equity markets.

  • Chinese component stocks were mixed, with Sunny Optical Technology gaining 19.8%, reversing some of the weakness in the prior month. Xiaomi Corp was also higher by 13.6%, and NetEase was up by 5.5%. Weakness was led by Baidu, lower by 23.0%, then by Kuaishou Technology, which fell by 19.9%. JD.com fell by 13.3%, Alibaba was down by 6.5%, Tencent fell by 5.6%, Meituan was down by 3.5%, and Bilibili fell by 2.2%.
  • Taiwan stock components were also mixed, led higher by MediaTek Inc., which gained 14.6%. Semiconductor manufacturer United Microelectronics Corp was up 2.2%, and Taiwan Semiconductor rose 1.1%. Delta Electronics continued its move lower, down by 10.5%, and Hon Hai Precision Industry fell by 7.2%.
  • Japanese components saw three stocks rise: Fujitsu by 10.3%, Keyence higher by 4.8%, and Sony Group rose by 1.5%. The rest fell: Murata Manufacturing was down the most by 9.4%, NTT Data fell by 8.1%, Z Corporation was lower by 8.0%, FujiFilm Holdings was down by 5.3%, Tokyo Electron fell by 3.4%, and Canon lower by 11.5%. Nintendo was marginally lower by 0.1%.
  • Korean component stocks saw only SK Hynix higher by 1.4%. Samsung SDI fell by 16.9%, followed by Kakao, down 14.0%, Naver Corp fell by 7.0%, and Samsung Electronics was down by 2.2%.
The MINI BRENT CRUDE FUTURES (BM) started the month weak, losing almost $9 from the September close at $92.20, and formed the low for the month at $83.44. The next two weeks saw the price climb to $93.79 and closed the month in the final week of the month at $85.02. Geopolitical conflict in the Middle East between Israel and Gaza triggered concerns about the potential impact on oil producers in the region and the flow on effect to global energy markets.

  • During the OPEC+ meeting held on October 4th, Saudi Arabia announced the extension of the voluntary 1 million barrel per day production cut to the end of December 2023. Russia also announced that it would extend its voluntary reduction of exports of 300,000 barrels per day to the end of December 2023.
  • According to a Reuters survey, October OPEC oil production rose by 180,000 barrels per day, driven by Nigeria and Angola. This, along with weaker manufacturing and non-manufacturing data out of China, could lead to lower demand for oil and, overall, could put downward pressure on oil prices in the short term.
MINI U.S. DOLLAR INDEX ® FUTURES
SYMBOL: SDX
CONDITIONS:
UPCOMING HIGH IMPACT EVENTS:

  • Tue 14 Nov Consumer Price Index (Oct)
  • Wed 15 Nov Retail Sales (Oct)
  • Tue 21 Nov FOMC Minutes
  • Wed 29 Nov GDP Annualized (Q3) PREL 
MARKET COMMENTARY
A bullish first day of October trading as demand for the U.S. Dollar increased and the market broke above September’s high. The rally extended into Tuesday’s trading and a new 2023 high was set at 106.72 before the bears returned and the SDX pulled back. Thereafter the SDX traded lower throughout the remainder of the week even after positive Nonfarm Payrolls data to close at 105.79 with a loss of 0.03%.

The bearish momentum continued into the following week until the SDX reached a daily support area at 105.38 - 105.00, this coincided with the release of the FOMC minutes. The demand for the U.S. Dollar returned, and this support level held. On Thursday following the CPI announcement, bullish sentiment returned as the SDX bounced off the daily 30 EMA which threaded through the support area. The SDX rallied and closed the day with a 0.76% gain, the strongest one-day performance of the month. This rally extended into Friday's trading and the SDX closed the week at 106.44 with a gain of 0.61%.

The SDX traded sideways throughout the week of October 16th with the strongest performing day on Wednesday, and the weakest performance on Thursday after the Fed Chair Jerome Powell hinted that tougher borrowing conditions were required to tame inflation. The week ended with SDX at 105.99 with a loss of 0.42%.

On Monday October 23rd, the bearish sentiment returned after money moved away from the U.S. Dollar with the initial response to the news of the 10-year Treasury yield reached 5% for the first time in 16 years. The SDX had the worst one-day performance of the month, losing 0.62% to close at 105.34, within the daily support area at 105.38 - 105.00. However, on Tuesday, the SDX rallied from this support area and posted gains for two consecutive days before the bears returned towards the end of the week. The SDX closed at 106.38 with a gain of 0.37%. During the final two trading days the bears generally maintained control.

The Mini U.S. Dollar Index ® Futures closed the month at 105.80 with a small loss of 0.02%. Based on the technical indicators the SDX was in an uptrend the weekly timeframe and reverted to a sideways trend on a daily timeframe.

Daily technical indicators of SDX prices indicated strong buy overall based on the moving averages. The technical oscillators indicated mostly neutral conditions, which could prompt investors to consider waiting for a pullback before seeking buying or selling opportunities. Using historical volatility, the price from the prior month’s close could range between 108.65 to 104.48 within the next 30 days. Investors or traders could consider the weekly support (104.19 to 102.89) or resistance (110.64 to 112.95) areas for planning their entries or exits, depending on their trading strategies.
Source: TradingView | Events Source: FXStreet | Conditions Table: using daily SMA (10, 20, 30,50, 100, 200), EMA (10, 20, 30,50, 100, 200), Ichimoku Cloud (9, 26, 52), VWMA (20), HullMA (9), RSI (14), Stochastic (14, 3, 3), CCI (20), ADX (14, 14), Awesome Oscillator, Momentum (10), MACD (12, 26, 9), Stochastic RSI (3, 3, 14, 14), Williams %R (14), Bulls and Bears Power and Ultimate Oscillator (7,14,28) | Statistical Ranges: projecting daily Historical Volatility (21, 42, 63) | Support & Resistance Levels: using AutoUFOs® (0.5) applied to daily, weekly and monthly timeframes (plotted as dotted lines that represent relevant support and resistance price zones colored as follows: red = resistance levels & green = support levels)
COINDESK BITCOIN FUTURES
SYMBOL: BMC
CONDITIONS:
UPCOMING HIGH IMPACT EVENTS:

  • April 2024 (Spring) bitcoin halving event
MARKET COMMENTARY
Bitcoin futures (BMC) broke the $32,000 level in a strong move on October 23rd, having traded between the $24,000 to $32,000 range since April 2023. The contract closed the month 27.5% higher at $34,687 versus the prior month's close. Bitcoin will need to maintain closes above the $25,000 level and set higher lows to indicate a continuation of an uptrend in price.

Companies like Zodia Custody, operating in the digital asset infrastructure sector, are actively expanding into new markets that aim to create conducive ecosystems for the growth of digital asset-driven enterprises. Zodia has recently initiated its services in Hong Kong, capitalizing on the considerable institutional demand for digital assets in the country. Notably, Zodia counts Standard Chartered Bank, Northern Trust, and SBI Holdings among its owners, underscoring the commitment of established financial institutions to invest in this technology.

Daily technical indicators of BMC prices indicated strong buying pressure based on the daily and weekly moving averages. The technical oscillators indicated mixed market conditions. Using historical volatility, the price from the prior month’s close could range between $29,315 to $40,057 ($10,742) in the next 30 days. Weekly support ($26,065 to $27,267) or resistance ($38,122 to $47,320) areas could be considered by investors or traders in planning their entries or exits based on their trading strategies.
Source: TradingView | Events Source: FXStreet | Conditions Table: using daily SMA (10, 20, 30,50, 100, 200), EMA (10, 20, 30,50, 100, 200), Ichimoku Cloud (9, 26, 52), VWMA (20), HullMA (9), RSI (14), Stochastic (14, 3, 3), CCI (20), ADX (14, 14), Awesome Oscillator, Momentum (10), MACD (12, 26, 9), Stochastic RSI (3, 3, 14, 14), Williams %R (14), Bulls and Bears Power and Ultimate Oscillator (7,14,28) | Statistical Ranges: projecting daily Historical Volatility (21, 42, 63) | Support & Resistance Levels: using AutoUFOs® (0.5) applied to daily, weekly and monthly timeframes (plotted as dotted lines that represent relevant support and resistance price zones colored as follows: red = resistance levels & green = support levels)
MICRO ASIA TECH 30 INDEX FUTURES
SYMBOL: ATI
CONDITIONS:
UPCOMING HIGH IMPACT EVENTS:

  • Thr 9 Nov China CPI (Oct)
  • Wed 15 Nov China Retail Sales (Sep)
  • Mon 20 Nov PCOB Interest Rate Decision
  • Thr 30 Nov China Manufacturing & Non-Manufacturing PMI (Nov)
MARKET COMMENTARY
ATI continued to set another lower-high in mid-October below $3,250, and a lower-low around $3,000. The index closed the month at $3,019 (4.0% lower) versus September, following weak performance in most global equity markets.

Chinese component stocks were mixed, with Sunny Optical Technology gaining 19.8%, reversing some of the weakness in the prior month. Xiaomi Corp was also higher by 13.6%, and NetEase was up by 5.5%. Weakness was led by Baidu, lower by 23.0%, then by Kuaishou Technology, which fell by 19.9%. JD.com fell by 13.3%, Alibaba was down by 6.5%, Tencent fell by 5.6%, Meituan was down by 3.5%, and Bilibili fell by 2.2%.

Taiwan stock components were also mixed, led higher by MediaTek Inc., which gained 14.6%. Semiconductor manufacturer United Microelectronics Corp was up 2.2%, and Taiwan Semiconductor rose 1.1%.

Delta Electronics continued its move lower, down by 10.5%, and Hon Hai Precision Industry fell by 7.2%.

Japanese components saw three stocks rise: Fujitsu by 10.3%, Keyence higher by 4.8%, and Sony Group rose by 1.5%. The rest fell: Murata Manufacturing was down the most by 9.4%, NTT Data fell by 8.1%, Z Corporation was lower by 8.0%, FujiFilm Holdings was down by 5.3%, Tokyo Electron fell by 3.4%, and Canon lower by 11.5%. Nintendo was marginally lower by 0.1%.

Korean component stocks saw only SK Hynix higher by 1.4%. Samsung SDI fell by 16.9%, followed by Kakao, down 14.0%, Naver Corp fell by 7.0%, and Samsung Electronics down by 2.2%.

Daily and weekly moving average technical indicators of ATI prices indicated strong selling market conditions during the month. Technical oscillators showed daily and weekly neutral conditions last month. Using historical volatility, the price from the prior month’s close could range between $2,809 to $3,229 ($420) in the next 30 days. Weekly support ($2,470 to $2,566) or resistance ($4,283 to $4,439) areas could be considered by investors or traders in planning their entries or exits based on their trading strategies.

Index Composition: 37% China, 23% Japan, 23% Taiwan and 17% South Korea
Source: TradingView | Events Source: FXStreet | Conditions Table: using daily SMA (10, 20, 30,50, 100, 200), EMA (10, 20, 30,50, 100, 200), Ichimoku Cloud (9, 26, 52), VWMA (20), HullMA (9), RSI (14), Stochastic (14, 3, 3), CCI (20), ADX (14, 14), Awesome Oscillator, Momentum (10), MACD (12, 26, 9), Stochastic RSI (3, 3, 14, 14), Williams %R (14), Bulls and Bears Power and Ultimate Oscillator (7,14,28) | Statistical Ranges: projecting daily Historical Volatility (21, 42, 63) | Support & Resistance Levels: using AutoUFOs® (0.5) applied to daily, weekly and monthly timeframes (plotted as dotted lines that represent relevant support and resistance price zones colored as follows: red = resistance levels & green = support levels)
MINI BRENT CRUDE FUTURES
SYMBOL: BM
CONDITIONS:
UPCOMING HIGH IMPACT EVENTS:

  • Wed 4 October OPEC+ 50th Joint Ministerial Monitoring Committee (JMMC) Meeting
MARKET COMMENTARY
Brent futures (BM) started the month weak, losing almost $9 from the September close at $92.20, and formed the low for the month at $83.44. The next two weeks saw the price climb to $93.79 and closed the month in the final week of the month at $85.02. Geopolitical conflict in the Middle East between Israel and Gaza triggered concerns about the potential impact on oil producers in the region and the flow on effect to global energy markets.

During the OPEC+ meeting held on October 4th, Saudi Arabia announced the extension of the voluntary 1 million barrel per day production cut to the end of December 2023. Russia also announced that it would extend its voluntary reduction of exports of 300,000 barrels per day to the end of December 2023.

According to a Reuters survey, October OPEC oil production rose by 180,000 barrels per day, driven by Nigeria and Angola. This, along with weaker manufacturing and non-manufacturing data out of China, could lead to lower demand for oil and, overall, could put downward pressure on oil prices in the short term.

Daily technical indicators of oil futures (BM) prices indicated a strong market bias toward selling. Technical oscillators in the prior month pointed towards a selling state of the market. Using historical volatility, the price from the prior month’s close could range between $73 to $97 ($24) in the next 30 days. Weekly support ($72.51 to $75.41) or resistance ($92.65 to $98.57) areas could be considered by investors or traders in planning their entries or exits based on their trading strategies. Weekly chart prices were sideward, trending between $72 and $99.
Source: TradingView | Events Source: FXStreet | Conditions Table: using daily SMA (10, 20, 30,50, 100, 200), EMA (10, 20, 30,50, 100, 200), Ichimoku Cloud (9, 26, 52), VWMA (20), HullMA (9), RSI (14), Stochastic (14, 3, 3), CCI (20), ADX (14, 14), Awesome Oscillator, Momentum (10), MACD (12, 26, 9), Stochastic RSI (3, 3, 14, 14), Williams %R (14), Bulls and Bears Power and Ultimate Oscillator (7,14,28) | Statistical Ranges: projecting daily Historical Volatility (21, 42, 63) | Support & Resistance Levels: using AutoUFOs® (0.5) applied to daily, weekly and monthly timeframes (plotted as dotted lines that represent relevant support and resistance price zones colored as follows: red = resistance levels & green = support levels)
Mini Thai Baht / US Dollar Futures contract with contract size of THB300,000 is cash-settled. The trading price quotation is USD per Thai Baht (THB/USD). Clients could leverage the use of this and other foreign exchange contracts such as the Mini Hong Kong Dollar/U.S. Dollar, Mini Taiwan Dollar/U.S. Dollar, or Mini U.S. Dollar/Singapore Dollar in their trading strategies or hedging. The reduced product size allows clients to optimize their capital exposure allocation and flexibility to utilize financial leverage across multiple products, giving portfolio diversification opportunities to the client.
Source: TradingView | Average True Range: using daily ATR (14) | Support & Resistance Levels: using AutoUFOs® (0.5) applied to daily and  weekly timeframes
(plotted as dotted lines that represent relevant support and resistance price zones colored as follows: red = resistance levels & green = support levels)
CONTRACT SPECIFICATIONS

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Futures contracts based on bitcoin may pose specific risks. Such risks may arise from greater volatility in prices resulting from a range of factors. Those risks could in turn affect financial outcomes associated with maintaining required margins or any losses at final contract settlement. Accordingly, such products may not be suitable for a retail investor or user, and such person may wish to approach their broker to assess his/her suitability to transact in the product.

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