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
The S&P 500 closed the week at 5,702, up 1.4%, achieving a new all-time high. The index has now gained 11% from its August lows. On both the weekly and daily timeframes, the 20 and 50 Simple Moving Averages (SMAs) remain aligned, reinforcing the strength of the trend.
Year to date, the S&P 500 has posted an impressive 20% gain. Despite recent volatility, bullish momentum continues, with the index up 38% from its October 2023 low and 61% from its October 2022 low.
While broad indices like the S&P 500 provide a general market outlook, they do not offer the full picture. We continue to see notable outperformance from individual stocks such as PGR, UNH, KO, and MMC, all of which we have highlighted in recent months.
The Nasdaq 100 extended last week’s gains, rising by 1.4%, while the Dow Jones increased by 1.5%, reaching a new all-time high.
In the UK, the FTSE 100 declined by 0.5%, closing at 8,230. After surpassing its all-time high in April, the index has been consolidating between 8,100 and 8,300 since June. Despite showing signs of strength, it has re-entered this consolidation range.
OUTPERFORMING ASSET FOR THE WATCHLIST
Oracle Corporation – ORCL
Oracle Corporation (ticker: ORCL) is an American multinational computer technology corporation headquartered in Texas. In 2020, Oracle was the third-largest software company in the world by revenue and market capitalisation.
Oracle (ORCL) has demonstrated a history of consistent and stable trends, particularly evident during its strong performance in 2021 and, more recently, since October 2022, showcasing its potential for steady upward movement. After reaching an all-time high in June 2023, the price pulled back to the $100 level before regaining momentum, resulting in a new all-time high this month.
ORCL closed the week at $168, marking an 18% increase over the past two weeks. Since October 2023, the price has used the weekly 50 Simple Moving Average (SMA) as a key support level and continues to trade above both the 50 and 200 SMAs. The Sublime trend filter remains green, signalling the continuation of a strong long-term trend.
On the daily chart, the Sublime trend filter also remains green, with the price trading above the 20, 50, and 200 SMAs, further reinforcing its near-term strength.
Looking ahead, the $200 round number is the next potential resistance level. Members of our Phoenix community will be closely monitoring for any continuation patterns above the all-time high, as Oracle’s historical trend behaviour could present valuable trading opportunities.
OUTPERFORMING ASSET FOR THE WATCHLIST
Quanta Services Inc. – PWR
Quanta Services (ticker: PWR) is an American corporation that provides infrastructure services for electric power, pipeline, industrial and communications industries. Capabilities include the planning, design, installation, program management, maintenance and repair of most types of network infrastructure. Quanta Services employs about 40,000 people. In 1998, Quanta went public on the New York Stock Exchange and was added to the S&P 500 index in June 2009.
PWR has exhibited a strong bullish trend since July 2020, establishing itself as a top-performing stock. Since its breakout in August 2020, the price has maintained a long-term upward trajectory, with gains exceeding 468%.
On the weekly time frame, PWR continues to trade above both the 50 and 200 Simple Moving Averages (SMAs). In early August, the price briefly pulled back to the weekly 50 SMA before the bulls regained control. Our proprietary tool, the Sublime trend filter, remains green, indicating sustained positive sentiment.
On the daily time frame, the Sublime trend filter also maintains its green status, with PWR trading above the 20, 50, and 200 SMAs.
Looking ahead, the next key area of potential resistance is the $300 round number. If PWR forms a continuation pattern above this level, it could offer a compelling opportunity for our Phoenix community members, given the stock’s strong long-term bullish trend.
Looking Ahead
This week, U.S. markets continued their rebound from the earlier weakness experienced in August. As previously mentioned, our measured and disciplined approach has proven effective, with our positions benefiting from the sustained positive momentum in the markets. The gains in trending stocks have further enhanced the profitability of our open positions, affirming the strength of our strategy.
We currently hold positions in a significant number of stocks displaying robust trends. As always, we will remain focused on allowing price action to guide our decisions, ensuring alignment with market dynamics and positioning ourselves to capitalise on emerging opportunities.
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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