Welcome to another edition of our weekly newsletter where we provide an overview of the main US and UK indices, a specifically selected outperforming asset with deep analysis. Finally, an analysis of an asset in our portfolio, including a discussion on the returns the asset is generating for our Phoenix members.
Let’s get into this week’s newsletter!
US & UK INDICES OVERVIEW
This week the US and UK equity markets have demonstrated continued strength.
On the monthly time frame, the S&P 500 has started November with strength, gaining 3.0% to date – this follows a gain of 7.8% in October. Since the low on 13th October, price has gained 14%. On the weekly time frame, the S&P 500 was particularly bullish with an engulfing candle and a gain of 6.0%. The bounce off the weekly 50 SMA has been confirmed. On the daily time frame, price has cleared both the 20 and 50 SMAs and is headed towards the important 200 SMA. The outlook for the S&P is to watch for further price action to challenge both the 4000 round number and the daily 200 SMA at 4071.
This week’s strength in the S&P 500 was seen across the US indices, with gains in the Nasdaq 100 and Dow Jones indices. The Nasdaq 100 gained 8.9% over the week, to close above the weekly 200 SMA. Whilst the Dow Jones, clearly the best performer of the US indices in recent months, gained 4.3% to retake the 50 SMA.
This week the FTSE 100, the UK index, was flat as price struggled at the weekly 50 SMA and daily 200 SMA. Price remains above the weekly 200 SMA which has been confirmed as support.
OUTPERFORMING ASSET FOR THE WATCHLIST
ConocoPhillips - COP
ConocoPhillips (ticker: COP) is an American multinational corporation engaged in hydrocarbon exploration and production. It is based in the Energy Corridor district of Houston, Texas. The company has operations in 15 countries, with 49% of its production in the United States.
COP is a stock with an interesting history of strong trends, such as 2004-6 and more recently, throughout 2021. Since price broke above last year’s high at $78, strength has been prevalent, resulting in a gain of 71%. Price has been particularly strong in October and November with gains of 23% and 6% respectively.
On the weekly time frame, price is trading above the 50 and 200 SMA, and the Sublime trend filter is green. Since price broke above the pivot high at $67 in September, price has shown strength, using the 50 SMA as support. This week price found support at a key pivot level and bounced to the upside.
On the daily time frame, the Sublime trend filter is also green. Price is currently trading above all moving averages, which are all aligned. Following earnings on 3rd November price pulled back to the 20 SMA where it found support.
Looking ahead, a continuation pattern above the current all-time high at $138 could offer our Phoenix community members an opportunity in a good-performing stock. The next area of resistance is the $200 round number.
Aspen Technologies - AZPN
Aspen Technology, Inc., known as AspenTech, is a provider of software and services for the process industries headquartered in Bedford, Massachusetts. AspenTech has 35 offices worldwide, on all continents (excluding Antarctica). Founded in 1981, AspenTech was born out of a joint research project between the Massachusetts Institute of Technology (MIT) and the US Department of Energy—called the Advanced System for Process Engineering (ASPEN) Project.
We first entered AZPN in July and have since compounded on multiple occasions.
The total performance to date is 263% Return On Investment, applying a total portfolio risk of 2%.
This stock is a good example of a trending stock in a volatile market. The total amount of time required to set up and manage this trade has been less than two hours over five months – this is the benefit of trend trading; using higher time frames such as monthly and weekly charts avoids the noise and stress of shorter time frames. This approach enables busy professionals the freedom to pursue other interests and avoid hours each day in front of a trading screen.
This week the US and UK indices have again demonstrated significant volatility. We continue to monitor all markets actively, scanning for opportunities such as the stocks described today, along with the JPY forex pairs and Dollar strength, and sharing these with our Phoenix community for excellent returns.
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Keep it simple. Keep it Sublime.
The ST Team