Technical analysis of Hong Kong 33, Germany 30, and Singapore 30: Examining potential bullish momentum amid US dollar weakness and trade tariff concerns.
For May, we will highlight three relevant instruments - the Hong Kong 33, Germany 30, and Singapore 30 to note in the medium-term horizon (multi-week), according to the latest developments in macro (fundamentals) and momentum factors (technical analysis).
In our prior monthly tactical views for April, we highlighted the risk of corrective decline sequences within the ongoing major uptrend phases of the Hong Kong 33 and Germany 30 CFD indices. Hong Kong 33 and Germany 30 staged the 17% and 16% down moves in light of the aggressive “Liberation Day” US reciprocal trade tariffs initiated by the US White House administration.
A softer US dollar may trigger a continuation of the underperformance of US stock indices
Fig 1: 3-month rolling performance of US stock indices, Hong Kong 33, Germany 30, Singapore 30 & US Dollar Index as of 2 May 2025 (Source: TradingView)
Despite the recent four weeks of recovery seen in the US stock market, reinforced by the 90-day pause on the higher US reciprocal trade tariffs issued by US President Trump on 9 April, the performance of the major US CFD stock indices is still being dwarfed by other regional stock markets.
Based on a three-month rolling performance as of 2 May, the Hong Kong 33, Germany 30, and Singapore 30 CFD stock indices staged positive returns of 13.50%, 9.27%, and 1.97%, respectively, that outperformed the US SPX 500 (-5.74%), US Nasdaq 100 (-6.33%), US Wall Street 30 (-7.18%), and US 2000 (-11.52%) (see Fig 1).
The underperformance of four US CFD stock indices has been moved in sync with the general weakness seen in the US dollar as presented by the US Dollar Index, which shed -7.8% over the same period.
The “US exceptionalism” theme is now being put on the back burner as market participants question its validity in the context of the erratic style of trade tariff policies implemented by the US White House administration and a less dovish US Federal Reserve. These may lead to slower growth prospects in the US, resulting in less allocation to US equities versus the rest of the world.
Hong Kong 33 staged a bullish reversal after a retest on its 200-day moving average
Fig 2: Hong Kong 33 major & medium-term trends as of 2 May 2025 (Source: TradingView)
The multi-week corrective decline of 23% seen in the Hong Kong 33 CFD Index (a proxy of the Hang Seng Index futures) from its 19 March 2025 swing high of 24,905 to 9 April low of 19,075 has managed to stall around the key 200-day moving average and the lower boundary of the medium-term ascending channel in place since 22 January 2024.
Thereafter, the price actions of the Hong Kong 33 CFD Index rallied by 18% from 9 April to 2 May, and the daily RSI momentum indicator flashed out a bullish momentum condition as it pierced above the 50 level after an extreme oversold condition of 20.29 printed on 8 Apr (see Fig. 2).
These observations suggest that the corrective decline may have ended, and a potential multi-week impulsive up-move sequence may have kickstarted within its major uptrend phase.
A clearance above the 22,690 intermediate resistance (also the 50-day moving average) sees the next medium-term resistances coming in at 25,080 and 26,200.
However, a break below the 19,780/18,995 key medium-term pivotal zone invalidates the bullish scenario to expose the next medium-term support at 16,955.
Germany 30 is on sight to stage a potential bullish breakout above its March all-time high
Fig 3: Germany 30 major & medium-term trends as of 2 May 2025 (Source: TradingView)
The price actions of the Germany 30 CFD Index (a proxy of the DAX futures) have staged a rally of 23% from its 7 April 2025 low of 18,902, which almost recovered all its losses inflicted in the prior 4-week of corrective decline from 6 March to 7 April.
In addition, the daily RSI momentum indicator has continued to display bullish momentum readings since its breakout above the 50 level on 23 April. Also, the Germany 30 CFD Index has started to trade above its 50-day moving average since 25 April.
These observations suggest that the Germany 30 CFD Index is likely to have evolved into a new potential multi-week impulsive up-move sequence. A clearance above the 23,480 intermediate resistance (the all-time high area of 6 March 2025) may see the next medium-term resistances coming in at 24,100, 24,670, and 25,360/775 (see Fig. 3).
On the other hand, a break below 21,460 invalidates the bullish scenario to reinstate the corrective decline sequence to expose the next medium-term support at 20,285 (also the 200-day moving average). Failure to hold at 20,285 may see a deeper drop towards the major support of 18,840.
Singapore 30 bullish breakout above 50-day moving average
Fig 4: Singapore 30 major & medium-term trends as of 2 May 2025 (Source: TradingView)
The price actions of the Singapore 30 CFD Index (a proxy of the MSCI Singapore futures) have staged a recent bullish breakout above its 50-day moving average on 30 April after a retest and reintegration above its key 200-day moving average.
In addition, the daily RSI momentum indicator has turned bullish since 24 April and has not reached an extreme overbought zone.
These observations suggest that the multi-week corrective decline sequence of 19% from 28 March to 9 April may have ended, and the Singapore 30 CFD Index has started a potential new multi-week bullish impulsive up move sequence for the next medium-term resistances to come in at 406.62/414.30 and 438.23 (see Fig. 4).
On the flip side, a break below the 370.12 key medium-term pivotal support (also close to its 20-day and 200-day moving averages) invalidates the bullish scenario to expose the next medium-term support at 349.76, and failure to hold above it may see further weakness towards the major support zone of 336.74/329.41.
