Welcome to our weekly newsletter where we provide an overview of the main US and UK indices, along with analyses of selected assets that are outperforming the market.
Let’s get into this week’s newsletter!
US & UK INDICES OVERVIEW
S&P 500
The S&P is showing bullish signs for May. Currently, there’s a long wick above the candle, suggesting a pullback is underway. To plan ahead, we need to identify support levels on lower timeframes to see if the price is likely to bounce and move higher.
So far in May, the S&P is up 4.25%. However, for the year, it’s down 1.18%. While the market was up last week, recent declines have pulled the price back, leaving it down overall for the year.
If the price bounces from support, we’ll look for it to push higher and break through key resistance levels. The first target is the $6,000 round number, followed by the 2024 high of $6,099 and the all-time high from February 2025 at $6,147.
Currently, the price has dropped to the daily 200 simple moving average at $5,772. A bounce from this level could drive the price higher. To confirm this move, we need to see the price break above the recent high from May 19th at $5,968. If it does, it could move towards the resistance levels mentioned, including the all-time high.
Dow Jones
On the monthly timeframe, the Dow Jones shows a bullish body for May and it has a long wick above the candle, suggesting a pullback. So far, May is up 2.23%, but for the year, it remains down 2.24%.
Nasdaq 100
The Nasdaq is up 6.83% for May but remains down slightly by 0.28% for the year. Similar to the Dow Jones and S&P, the Nasdaq is experiencing a pullback. It’s important to identify key support levels where the price could rebound and continue upward. On the monthly timeframe, the next support level is around the $20,000 mark.
FTSE 100:
The FTSE has shown bullish momentum so far in May. Earlier this month, the price bounced off support at the 2024 high of 8,474, pushing further upward. However, the current all-time high of 8,908, set in March, has yet to be tested.
If bullish momentum on lower timeframes continues, with higher highs and higher lows forming, we could see the price move toward the all-time high, potentially breaking out and continuing upward.
The week ended with a reversal candle, which might signal a potential pullback as we head into the new week. However, despite this, the price could still continue climbing. On Friday, the reversal candle caused a pullback to the 20-day simple moving average at 8,600. Moving into next week, we’ll be watching for a bounce off this support area, which could lead to further upward movement.
Since the low on April 7th at 7,554 (caused by tariff news), the price has climbed by 15%. If this momentum holds, the FTSE could continue its upward trend. So far, May is up by 2.58%, and the FTSE 100 is up by 6.7% for the year. Progress looks strong, and the focus is on maintaining and building on this growth as May comes to a close.
PERFORMANCE REVIEW
Philip Morris International (PM)
Philip Morris International is having a strong month, with its stock up 4% in May and an impressive 47.91% rise for the year so far. The stock has been performing exceptionally well over the past year, consistently reaching new record highs. The next major resistance level to watch is the $200 mark.
Last week ended on a bullish note, with the stock reaching a new high before pulling back. On May 7th, the price dropped to a low of $162 but found support at that level. Since then, it has rebounded with a 9% increase, climbing back up and breaking the previous high of $176, which happened on Friday. This strong finish to the week suggests continued upward momentum as we approach the end of the month. We’re optimistic this trend will carry into the new month as well.
OUTPERFORMING ASSET FOR THE WATCHLIST
Curtiss-Wright (CW)
Curtiss-Wright is showing strong performance in May, with its stock currently up by 24.12% for the month. This is a significant gain compared to the broader indices, which are only slightly up. The stock has also surpassed its 2024 high of $393 and moved above the $400 mark.
For the year, Curtiss-Wright is up 20%, continuing its impressive performance. Looking at the longer-term trend, the stock has climbed substantially since March 2020, when it was trading at $129. It has now reached $428, marking a rise of over 500%—a clear indication of a strong, steady uptrend.
Zooming in on recent price action, the stock was in a consolidation phase from November 11th until it broke out on May 30th, moving sideways for 124 trading days (around six months). During this period, price was bounded between $266 (support) and $393 (resistance). Now that the stock has broken out of this consolidation, we anticipate further upward momentum. Longer consolidation periods often lead to stronger moves in the breakout direction, and this appears to be the early stage of a new long-term uptrend.
A pullback to support levels, such as the $400 mark or $393, could occur before the stock continues its upward trajectory. As long as the price maintains its pattern of higher highs and higher lows, we expect Curtiss-Wright to keep trending upward.
Looking Ahead
Currently, 38% of U.S. stocks are trading above their 200-day moving average, a drop from 44% last week. The S&P 500 has risen 19% since its April 7 low. It has now pulled back to a support level, and if it bounces back and moves higher, we could see more stocks breaking out and reaching record highs.
Keep it simple. Keep it Sublime.
The ST Team
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