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 we have 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 declined, again demonstrating the volatility we have discussed throughout most of 2022. As we will discuss further in this newsletter, diversifying your portfolio to include assets such as forex can enable investors to take advantage of trends in all markets.
On the monthly time frame, the S&P 500 continues to trade within a large channel from the high in January. A close above the high in June and July at 4200 would represent a breakout of the channel. This week the S&P 500 declined by 4.9% which follows last week’s decline of 4.5%. On the weekly time frame price continues to trade below the 50 SMA but remains above the 200 SMA. Whilst on the daily time frame, this week price declined to close below both the 20 and 50 SMA – price is now trading below all moving averages. On the positive side for the bulls, there is significant potential support below the current price with the weekly 200 SMA at 3562, the prior year pivot low at 3662, and the pivot low from June at 3637.
The weakness in the S&P 500 was seen across the markets, with weekly declines in both the Nasdaq 100 and Dow Jones indices of 4.8% and 4.3% respectively. Also similar to S&P 500, the Nasdaq 100 and Dow Jones are at significant support levels. Our position remains unchanged; we continue to seek opportunities but remain vigilant.
This week the FTSE 100, the UK index, weakened by 3.0% to remain below the 50 SMA. Price is in a range between the all-time high at 7687 and the weekly SMA, currently at 6945. There is potential support below price on the weekly chart with the 7000 round number and the 200 SMA at 6947. As with the US indices, we are actively looking for opportunities, but remain vigilant.
OUTPERFORMING ASSET FOR THE WATCHLIST
US Dollar Basket - DXY
DXY is maintained, and published by ICE (Intercontinental Exchange, Inc.), with the name “U.S. Dollar Index” as a registered trademark. It represents the value of the United States dollar relative to a basket of foreign currencies, including the Euro (EUR), 57.6% weight, Japanese yen (JPY) 13.6% weight, Pound sterling (GBP), 11.9% weight, Canadian dollar (CAD), 9.1% weight, Swedish krona (SEK), 4.2% weight and Swiss franc (CHF) 3.6% weight. The Index goes up when the U.S. dollar gains “strength” (value) when compared to other currencies.
DXY has a history of long-term trends, both bullish and bearish, which positions it as an attractive asset to trade. On the monthly time frame, since price broke above last year’s high at 96.88, price has gained 16.4%. Price has been particularly bullish in September with a gain to date of 4.1%, resulting in an all-time high at 112.9.
On the weekly time frame, price is trading above the 50 and 200 SMA, and the Sublime trend filter is green. This week’s candle was a major breakout bar. Whilst on the daily time frame below, price is trading above the 20, 50 and 200 SMA, and the Sublime trend filter is also green.
Looking ahead, a continuation pattern above the current all-time high could offer our Phoenix community members an opportunity in USD-related assets.
PERFORMANCE REVIEW
EURUSD
EURUSD is an asset with a history of powerful trends such as 2008-9 during the financial crisis. As we have mentioned in previous editions, investing in forex assets can be difficult, but with the proper knowledge and support, such as that which our Phoenix community receive, successfully trading the asset class is achievable.
We recently entered EURUSD. Price has been particularly weak since breaking below last year’s previous low at 1.119. September’s candle has continued the momentum with a decline to date of 3.6% and a close below the significant round number at 1.000. We will look for compounding opportunities, particularly as strength in DXY continues.
Looking Ahead
This week the US and UK indices have significantly declined. 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.
Answer 21 rapid-fire questions about your investing approach and then as if by magic, we will give you recommendations that are right for you and you’ll unlock your FREE Bonuses that will improve your investing results over the next 3 to 5 years.).
Keep it simple. Keep it Sublime.
The ST Team
