April 2023

ICE Futures Singapore Monthly Report

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MACRO COMMENTARY

The MINI U.S. DOLLAR INDEX ® FUTURES (SDX) dropped 0.77% in April as investors continued to move from the safe-haven. The SDX closed at 101.41.

  • Nonfarm Payrolls data fell short of expectations with 236,000 new jobs created during March, just shy of the forecast of 240,000 jobs. This was the lowest level reported since December 2020 and significantly below the upwardly revised 326,000 jobs created in February (up from 311,000). The SDX was closed in respect of Good Friday.
  • Core Inflation (all items less food and energy) ticked up slightly to 5.6% for the period 12-month ending March against the previous 5.5% rise during February. The data released matched market estimates. The SDX closed the day at 101.17 with a loss of 0.70%.
  • The FOMC minutes also released on the same day as U.S. inflation data confirmed the 25 basis points (bps) decision in March was unanimous, taking the benchmark Federal Funds rate to a target range between 4.75% - 5.0% as officials continued to watch incoming data with some calling for flexibility on future decisions.

The BAKKT ® BITCOIN (USD) CASH SETTLED MONTHLY FUTURES (BMC) took two weeks to clear the $30,000 level, which it held for nine days before retreating toward $27,000. Alternative assets remained attractive to market participants for relative safety versus equities, as economic uncertainty continued to be a concern surrounding major economies. BMC closed the month higher at $29,173 with a +2.4% change.

  • In April 2024, the reward bitcoin miners will receive for mining bitcoin will halve. Bitcoin commentators expected the price to rise in a similar pattern to previous halving events which occurred in 2012, 2015, and 2019. This halving process intends to reduce the rate at which new bitcoin are created and therefore lower the available amount of new supply. The result observed in the past has been increased demand for the circulating bitcoin supply and higher prices.
  • Financial regulators in Singapore and Hong Kong have taken a measured approach to banks providing services to digital asset firms. The Hong Kong Monetary Authority (HKMA) issued a circular which noted that financial institutions “should endeavor to support virtual asset service providers (VASPs)” that are licensed by the Securities and Futures Commission (SFC). In Singapore, the Monetary Authority of Singapore (MAS) is seeking to provide best practices to financial institutions for taking on clients involved in providing services involving digital assets.

The MICRO ASIA TECH 30 INDEX FUTURES (ATI) held the lower high set in March around the $3,100 level. Prices moved lower for the month and closed at $3,180 (6.8% lower). Technology stocks experienced weakness along with the overall weakness in equity markets.

  • Most of the Chinese component stocks fell with the exception of NetEase which rose marginally by 0.4%. Baidu fell the most by 22.2%, followed by JD.com lower by 21.0%. Other stocks fell in the teens that included Alibaba falling 18.3%, Bilibili lower by 17.1%, Kuaishou Technology down by 15.1%, and Sunny Optical Technology by 13.3%.
  • Taiwan stock components saw drops led by Media Tek Inc falling 15.5%, United Microelectronics Corp was lower by 7.2%, and Taiwan Semiconductor down by 5.8%. Hon Hai Precision Industry was marginally higher by 0.5% and Delta Electronics was marginally lower by 0.3%.
  • Japanese components closed mixed with Nintendo higher by 11.5%, Canon rising 9.6%, Sony Group rose by 7.1%, and NTT Data Corporation higher by 6.2%. Keyence Corporation fell 5.2%, Tokyo Electron was down by 3.4%, and Murata Manufacturing Co., Ltd. fell by 2.0%.
  • Korean component stocks ended the month mixed with Samsung SDI falling 6.0%, Kakao lower by 4.9%, and Naver Corp down by 4.8%. Samsung Electronics rose by 2.3%, and SK Hynix higher by 1.0%.
The MINI BRENT CRUDE FUTURES (BM) attempted to break the $87.00 level at the start of the month, traded down towards $78.00 despite the surprise cuts to production announced in early April, and were to take effect beginning May. Recent economic data out of the United States suggested a possible U.S. recession as well as a final interest rate hike by the United States Federal Reserve Bank in its tightening cycle aimed at high inflation.

  • The OPEC+ committee will next meet on Sunday, 4th June, with oil commentators not expecting any further action from the group. The updated voluntary reductions in production announced in April are now expected to total around 1.66 million barrels per day. The countries involved include Russia, Saudi Arabia, Iraq, United Arab Emirates, Kuwait, Kazakhstan, Algeria, Oman, and Gabon.
  • Sanctions imposed by the European Union (EU) aimed at weakening Russia’s ability to finance the war against Ukraine have limited Russia’s revenues from fossil fuels. According to the International Energy Agency (IEA), Russia’s oil revenues dropped by 26.9% in January 2023 and 41.7% in February 2023, as compared to the same months in 2022. Russian assets have also been frozen including €300 billion of Russian Central Bank reserves.
MINI U.S. DOLLAR INDEX ® FUTURES
SYMBOL: SDX
CONDITIONS:
UPCOMING HIGH IMPACT EVENTS:

  • Wed 3 May Fed Interest Rate Decision
  • Fri 5 May Nonfarm Payrolls (Apr)
  • Wed 10 May Consumer Price Index (Apr)
  • Tue 16 May Retail Sales
  • Wed 24 May FOMC Minutes
MARKET COMMENTARY
A disappointing start to April as the bears drove the mini U.S. Dollar Index ® Futures lower despite the resilience of the bulls midweek the SDX closed the week down at 101.52, with a loss of 0.65%. The following week core inflation data showed a slight uptick and FOMC minutes released gave an insight into the unanimous decision behind the 25 bps hike and the need to carefully look at incoming data in future decisions. Concerns voiced about the current banking crisis could lead to a mild recession later in the year. These messages led to the largest one-day loss for the month, down 0.70%. The SDX closed the week 101.25 with a loss of 0.27%, to post a fifth straight losing week as money continued to move away from the safe-haven. The third week of trading had no major U.S. reports and the bulls recovered some ground leading the SDX to close with a gain of 0.30% at 101.55. The bears returned during the final week of trading and the SDX closed with a loss of 0.15% at 101.41.

The mini U.S. Dollar Index ® Futures closed the month at 101.41 with a loss of 0.77%. Based on the technical indicators the trend was down on both the Daily and Weekly timeframes.

Daily technical indicators of SDX prices indicated strong sell 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 selling opportunities. Using historical volatility, the price from the prior month’s close could range between 104.41 to 98.69 within the next 33 days. Investors or traders could consider the weekly support (100.59 to 99.64) or resistance (105.81 to 101.63) 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)
BAKKT ® BITCOIN (USD) CASH SETTLED MONTHLY FUTURES
SYMBOL: BMC
CONDITIONS:
UPCOMING HIGH IMPACT EVENTS:

  • Spring 2024 bitcoin halving event
MARKET COMMENTARY
Bitcoin futures (BMC) prices took two weeks to clear the $30,000 level, which it held for nine days before retreating toward $27,000. Alternative assets remained attractive to market participants for relative safety versus equities, as economic uncertainty continued to be a concern surrounding major economies. BMC closed the month higher at $29,173 with a +2.4% change.

In April 2024, the reward bitcoin miners will receive as reward for mining bitcoin will halve. Bitcoin commentators were expecting price to rise in a similar pattern to previous halving events which occurred in 2012, 2015, and 2019. This halving process intends to reduce the rate at which new bitcoin are created and therefore lower the available amount of new supply. The result observed in the past has been increased demand for the circulating bitcoin supply and higher prices.

Financial regulators in Singapore and Hong Kong have taken a measured approach to banks providing services to digital asset firms. The Hong Kong Monetary Authority (HKMA) issued a circular which noted that financial institutions “should endeavor to support virtual asset service providers (VASPs)” that are licensed by the Securities and Futures Commission (SFC). In Singapore, the Monetary Authority of Singapore (MAS) is seeking to provide best practices to financial institutions for taking on clients involved in providing services involving digital assets.

Daily technical indicators of BMC prices indicated buying pressure based on the daily and weekly moving averages. The technical oscillators indicated mostly neutral conditions. Using historical volatility, the price from the prior month’s close could range between $22,665 to $34,910 ($12,245) in the next 30 days. Weekly support ($15,567 to $16,580) 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:

  • Wed 11 Jan China CPI (Dec)
  • Fri 20 Jan Retail Sales (Dec)
  • Tue 31 Jan China Non-Manufacturing PMI (Jan)
MARKET COMMENTARY
ATI held above the lower high set in March around the $3,100 level. Prices moved lower for the month and closed at $3,180 (6.8% lower). Technology stocks experienced weakness along with the overall weakness in equity markets.

Most of the Chinese component stocks fell with the exception of NetEase which rose marginally by 0.4%. Baidu fell the most by 22.2%, followed by JD.com lower by 21.0%. Other stocks fell in the teens that included Alibaba falling 18.3%, Bilibili lower by 17.1%, Kuaishou Technology down by 15.1%, and Sunny Optical Technology by 13.3%.

Taiwan stock components saw drops led by Media Tek Inc falling 15.5%, United Microelectronics Corp was lower by 7.2%, and Taiwan Semiconductor down by 5.8%. Hon Hai Precision Industry was marginally higher by 0.5% and Delta Electronics was marginally lower by 0.3%.

Japanese components closed mixed with Nintendo higher by 11.5%, Canon rising 9.6%, Sony Group rose by 7.1%, and NTT Data Corporation higher by 6.2%. Keyence Corporation fell 5.2%, Tokyo Electron was down by 3.4%, and Murata Manufacturing Co., Ltd. fell by 2.0%.

Korean component stocks ended the month mixed with Samsung SDI falling 6.0%, Kakao lower by 4.9%, and Naver Corp down by 4.8%. Samsung Electronics rose by 2.3%, and SK Hynix higher by 1.0%.

Daily technical indicators of ATI prices indicated strong selling pressure based on the moving averages. Technical oscillators were showing daily neutral and weekly neutral conditions. Using historical volatility, the price from the prior month's close could range between $2,977 to $3,415 ($438) in the next 30 days. Weekly support ($2,470 to $2,566) or resistance ($3,284 to $3,341) areas could be considered by investors or traders in planning their entries or exits based on their trading strategies. The daily chart have indicated prices trending upward until continued lower closes occur.
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:

  • Mon 3 Mar OPEC Joint Ministerial Monitoring Committee Meeting
  • Sun 4 Jun 35th OPEC and non-OPEC Ministerial Meeting
MARKET COMMENTARY
Brent futures (BM) attempted to break the $87.00 level starting the month, traded down towards $78.00 despite the surprise cuts to production announced in early April, and were to take effect beginning May. Recent economic data out of the United States suggested a possible U.S. recession as well as a final interest rate hike by the United States Federal Reserve Bank in its tightening cycle aimed at tackling high inflation.

The OPEC+ committee will next meet on Sunday, 4th June, with oil commentators not expecting any further action from the group. The updated voluntary reductions in production announced in April are now expected to total around 1.66 million barrels per day. The countries involved include Russia, Saudi Arabia, Iraq, United Arab Emirates, Kuwait, Kazakhstan, Algeria, Oman, and Gabon.

Sanctions imposed by the European Union (EU) aimed at weakening Russia’s ability to finance the war against Ukraine have limited Russia’s revenues from fossil fuels. According to the International Energy Agency (IEA), Russia’s oil revenues dropped by 26.9% in January 2023 and 41.7% in February 2023, as compared to the same months in 2022. Russian assets have also been frozen including €300 billion of Russian Central Bank reserves.

Daily technical indicators of oil futures (BM) prices indicated a weak market biased towards selling. Technical oscillators pointed towards the neutral state of the market and provided no incentive for clear directional opportunities in either the short or long term. Using historical volatility, the price from the prior month's close could range between $70 to $90 ($20) in the next 30 days. Weekly support ($72.35 to $76.69) or resistance ($84.18 to $87.33) areas could be considered by investors or traders in planning their entries or exits based on their trading strategies. Weekly chart prices are observed to be downward trending.
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 MSCI Europe Index Futures (SME) contracts with a notional contract size of approximately USD 20,000 are cash-settled.  Retail and professional investors are able participate in these markets with minimal upfront deposits and experience a liquid intraday order book provided by appointed market makers during Asian trading hours.
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Risk Considerations for Retail Investors or Users
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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