Welcome to our weekly newsletter where we provide an overview of the main US and UK indices, along with analyses of selected stocks that are outperforming the market.
Let’s get into this week’s newsletter!
US & UK INDICES OVERVIEW
S&P 500 Momentum Continues With Its Strongest Performance Since March
After last week’s notable gains in both the S&P 500 and Nasdaq, this week the bulls have paused their advance. This is to be expected after every significant move, as we have seen in May and June. The critical level to watch is the August high at 4325. Given the strength in the current trend, we anticipate this level to act as support and price to bounce off this level.
At Sublime Trading, our proven methodology revolves around a successful approach that prioritises factual evidence; market prices dictate our actions.
As mentioned last week, throughout June, the S&P 500 has exhibited a bullish trend, accumulating a gain of 4.0% to date. While May’s performance was more modest, closing with a 0.2% gain, the overall trend remains positive. Looking at the bigger picture, the S&P 500 has returned an impressive 13.1% gain thus far in 2023.
On the weekly time frame, the S&P 500 continues to trade above both the 50 and 200 SMAs. Whilst on the daily time frame, we saw weakness this week, and expect price to pull back to the 20 SMA. Despite this week’s weakness, these indicators give us confidence market sentiment remains strong and favourable for the index trend to continue. Our proprietary tool, the Sublime trend filter, remains green on both the weekly and daily time frames, providing additional confirmation of the index’s positive conditions.
The FTSE 100, the UK’s premier index, closed the week with a decline of 2.4%, closing at 7462. Price has now closed below the weekly 50 SMA, but remains above the 200 SMA.
OUTPERFORMING ASSET FOR THE WATCHLIST
Apple - AAPL
AAPL: New All-Time High For The World’s Favourite Personal Device Manufacturer
Apple needs little introduction; the market leader in personal computers, mobile devices and software. Apple is the world’s largest technology company by revenue, with US$394.3 billion in 2022 revenue. As of March 2023, Apple is the world’s biggest company by market capitalisation. As of June 2022, Apple is the fourth-largest personal computer vendor by unit sales and the second-largest mobile phone manufacturer in the world. It is often considered as one of the Big Five American information technology companies, alongside Alphabet (parent company of Google), Amazon, Meta Platforms, and Microsoft.
AAPL has exhibited an impressive long-term trend since October 2010, resulting in a gain of over 1500%! While the stock displayed a particularly bullish performance throughout 2021, it experienced a period of weakness in 2022. However, in 2023 the bulls have regained control.
Closing the week at $187, AAPL was bullish with an increase of 1.1% over the past week. Notably, this stock has demonstrated a particularly bullish trend during the month of June, boasting a gain of 5.6% to date. In fact, AAPL has delivered a substantial return of 43.8% since the beginning of 2023.
On the weekly time frame, AAPL continues to trade above the 50 and 200 SMAs. Our proprietary tool, the Sublime trend filter, maintains a green signal, indicating a positive market sentiment. Furthermore, the alignment of the moving averages reinforces this positive outlook.
Similar to the weekly analysis, on the daily time frame, the Sublime trend filter also displays a green signal. Additionally, AAPL’s price remains above the 20, 50, and 200 SMAs, further confirming its strength. The alignment of the moving averages suggests a favorable near-term outlook, while the utilisation of the 20 SMA as a support level contributes to the creation of higher highs and higher lows.
Looking ahead, the next significant level of potential resistance at the $200 round number. Should AAPL demonstrate a continuation pattern above its all-time high, members of our Phoenix community may find an opportunity in a stock with a robust history of long-term trends.
OUTPERFORMING ASSET FOR THE WATCHLIST
Copart Inc. - CPRT
CPRT: Bullish Momentum in June Continues Impressive 2023 Performance
Copart, Inc. (ticker: CPRT) is a global provider of online vehicle auction and remarketing services to automotive resellers such as insurance, rental car, fleet and finance companies in 11 countries; the US, Canada, the UK, Germany, Ireland, Brazil, Spain, UAE, Bahrain, Oman and Finland. Headquartered in Dallas, Texas, Copart has more than 200 physical locations around the world, where it houses more than 10,000 acres of vehicle inventory.
CPRT concluded the week at $89, resulting in a bullish increase of 2.3% over the past week. Notably, this stock has demonstrated very bullish price action throughout the month of June, boasting an impressive gain of 12.7% to date. Furthermore, CPRT has delivered a significant return of 45.9% in 2023.
On the weekly time frame, CPRT maintains a trading position above the 50 and 200 SMAs. Our proprietary tool, the Sublime trend filter, continues to display a green signal, reflecting a positive market sentiment. Whilst the alignment of the moving averages further strengthens the overall outlook.
Similarly, on the daily time frame, the Sublime trend filter remains green, underscoring a favorable market condition for CPRT. Furthermore, the stock price continues to trade above the 20, 50, and 200 SMAs. Similar to AAPL, the utilisation of the 20 SMA as a support level, as evidenced by a series of higher highs and higher lows, adds to the positive momentum.
Looking ahead, it is crucial to consider the next significant area of potential resistance at the important $100 round number. A continuation pattern above the all-time high could offer members of our Phoenix community an opportunity in this very bullish stock.
Looking Ahead
After every large move, such as what we have seen in the S&P 500 throughout May and June, we can expect a pullback. This is the market ‘breathing’. As informed investors that understand this dynamic, our Phoenix Community will monitor this movement and, as per our trading plan, await price to dictate before deciding our next move. The S&P 500’s momentum signals the potential for ongoing growth.
At Sublime, our unwavering commitment lies in conducting thorough analysis based on objective data and factual evidence presented in the charts. By adopting this approach, we aim to provide valuable guidance to our esteemed Phoenix community, collectively exploring opportunities that hold the potential for long-term, profitable trades.
Keep it simple. Keep it Sublime.
The ST Team
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