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
This week the S&P 500 gained 0.6%, to close at 5465. Strength in US equities was seen across all indices, with the Nasdaq 100 gaining 0.2%, and the Dow Jones Index gaining 1.6%. On a monthly basis, the weakness seen in April was fully countered in May, and that momentum has continued into June, resulting in a gain to date of 3.6%. Year to date the S&P 500 has gained an impressive 14.6%.
The bullish momentum in equity markets remains strong. The S&P 500 has surged 32% since the low in October 2023 and 55% since the low in October 2022.
We continue to see individual stocks perform well. Our portfolio currently comprises over 20 US stocks, including LLY, AMP, META, NVDA and MCK. We have compounded these assets on multiple occasions, resulting in excellent profit for our Phoenix community members.
The FTSE 100, the UK’s premier index, bucked recent weakness by gaining 1.1% over the week, to close at 8238. Following a breakout above the all-time high in April, price has been bullish. As a result, we are now actively looking for opportunities.
OUTPERFORMING ASSET FOR THE WATCHLIST
Microsoft Corporation – MSFT
Microsoft (ticker: MSFT) needs little introduction. as the most prominent software seller dominating the PC market with its uber-popular Windows operating system and Office software packages. They also broke into gaming in 2001 with the Xbox. Microsoft ranked No. 14 in the 2022 Fortune 500 rankings of the largest United States corporations by total revenue; it was the world’s largest software maker by revenue as of 2022. It is considered one of the Big Five American information technology companies, alongside Alphabet, Amazon, Apple, and Meta.
Since July 2016, MSFT has maintained a robust long-term trend, solidifying its status as a noteworthy stock. Over this period, the price has surged by an impressive 800%. For trend followers, MSFT undeniably stands as the king of stocks, exemplifying its remarkable market returns.
Closing the week at $450, MSFT printed a new all-time high. Throughout 2022 price experienced an uncharacteristic decline, resulting in a bottom in November 2022 at $213. In 2023 the bulls regained control, and price has subsequently gained over 100%.
On the weekly time frame, MSFT continues to trade above the 50 and 200 SMAs. Our proprietary tool, the Sublime trend filter, is green, reinforcing the bullish outlook. Whilst on the daily time frame, the Sublime trend filter also remains green. MSFT is also trading above the 20, 50, and 200 SMAs. Furthermore, the moving averages are aligned and diverging, indicating near-term strength.
Looking ahead, should a continuation pattern emerge above the all-time high, MSFT could present an opportunity for our Phoenix community members, who have profited handsomely in this stock for a number of years.
OUTPERFORMING ASSET FOR THE WATCHLIST
Cadence Design Systems Inc. – CDNS
Cadence Design Systems, Inc. (ticker: CDNS) is an American multinational computational software company, founded in 1988 by the merger of SDA Systems and ECAD, Inc. The company develops software, hardware and intellectual properties (IP) used to design chips, systems and printed circuit boards, as well as IP covering interfaces, memory, analogue, SoC peripherals, data plane processing units, and verification.
CDNS has demonstrated a consistent upward trajectory since 2012, making it an appealing stock for long-term investors. Between December 2021 and February 2023, the stock experienced a period of consolidation. However, in March 2023, the stock broke out of this range, resulting in a gain to date of 67%. As a result CDNS is high on our watchlist.
On the weekly time frame, CDNS continues to trade above the 50 and 200 SMAs, indicating positive market sentiment. Our proprietary tool, the Sublime trend filter, remains green, reinforcing the bullish outlook. Similarly, on the daily time frame, the Sublime trend filter remains green, further evidence of a favourable market sentiment. CDNS is trading above the 20, 50, and 200 SMAs.
Looking ahead, with price challenging the all-time high, we will monitor the stock to assess whether this level will act as resistance. Should a continuation pattern emerge above this level, our Phoenix community members may find an opportunity in a stock that has yielded very profitable trades in the past.
Looking Ahead
We believe the bullish trends in US equities will continue. Our multiple positions are benefiting from this momentum. As always, we will let price action guide our next move.
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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