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 markets experienced a rebound from the April declines. The S&P 500 closed the week at 5223, a gain of 1.85%. Whilst the Nasdaq 100 and Dow Jones Index also returned healthy gains. On a monthly basis, the weakness seen across the markets in April, where the S&P 500 declined by 4.5%, has been met by strong buying power, resulting in the S&P 500 gaining 4.1% to date in May.
The strength in equity markets remains with the bulls. The S&P 500 index has gained 25% since the October 2023 low and 49% since the October 2022 low.
We continue to see individual stocks perform well. Our portfolio currently comprises over 20 US stocks, including LLY, AMP, META and NVDA. We have compounded these assets resulting in excellent profit for our Phoenix community members.
The FTSE 100, the UK’s premier index, declined by 2.7% to close the week at 8434. The breakout in this index is gaining momentum. Following a breakout above the all-time high three weeks ago, price has been bullish, resulting in a gain to date of 6.8%. As a result, we are now actively looking for opportunities.
OUTPERFORMING ASSET FOR THE WATCHLIST
Progressive Corporation – PGR
Progressive Corporation (ticker: PGR) is an American insurance company, the third-largest insurance carrier and the largest commercial auto insurer in the United States. The company was co-founded in 1937 and is headquartered in Mayfield Village, Ohio. The company insures passenger vehicles, motorcycles, RVs, trailers, boats, PWC, and commercial vehicles. Progressive also provides home, life, pet, and other insurance through select companies. The company is ranked No. 74 on the 2021 Fortune 500 list of the top American corporations.
Looking at the monthly chart, PGR is a stock in a long-term uptrend, with a gain of over 510% since January 2017. From a trend-trading perspective, PGR is a high quality stock our Phoenix Community has traded for good profit in the past. Following a sharp decline in July, price has been in a strong uptrend, gaining 71%. This month price has created an all-time high at $218.
On the weekly chart, PGR is in a bullish trend and the Sublime trend filter is green. The weekly 50 and 200 SMA are both aligned in an upward direction and the price is currently trading above both these averages, indicating bullish momentum.
Looking at the daily chart, the price of PGR is currently trading above the 20, 50 and 200 SMA, and the moving averages are now fully aligned. The Sublime trend filter is green. Following alignment of the moving averages in January, price has been using the zone between 20 and 50 SMAs.
The next area of potential resistance is the $250 round number. A continuation pattern above the current all-time could offer our Phoenix community an opportunity in a very bullish stock.
OUTPERFORMING ASSET FOR THE WATCHLIST
Marsh & McLennan Companies – MMC
Marsh & McLennan Companies, Inc. (ticker: MMC) is a global professional services firm, with businesses in insurance brokerage, risk management, reinsurance services, talent management, investment advisory, and management consulting. Its four main operating companies are Marsh, Guy Carpenter, Mercer, and Oliver Wyman. MMC ranked #212 on the 2018 Fortune 500 ranking. In 2017, Business Insurance ranked MMC #1 of the world’s largest insurance brokers.
MMC is a stock with an excellent history of trends dating back as far as 2013. This pedigree gives us confidence that the stock has the potential to continue to trend in the future. Notably, in June, price broke out above the previous year’s high at $183. Since then, price has been moving higher, resulting in an all-time high of $209 in March.
MMC concluded the week at $206. On the weekly time frame MMC continues to trade above both the 50 and 200 SMA. The Sublime trend filter remains consistently green, aligning with the bullish sentiment.
Whilst on the daily timeframe, the Sublime trend filter also continues to signal green, consistent with the longer-term trend perspective. Price action on the daily frame shows MMC trading above the 20, 50, and 200 SMAs. However, due to recent mixed price action, the moving averages are not fully aligned.
Looking ahead, we are applying patience to assess whether price can hold above the $200 round number. A close above the recent all-time high could present an opportunity for our Phoenix community members.
Looking Ahead
The volatile seen in April has been countered by strength in May. We believe the bulls remain in control of the US equity markets, and now in the UK markets. We have a large number of positions which are profiting from this momentum. As always, we will let price dictate 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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