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 again displayed extreme volatility. This was most evident on Thursday when price initially declined 2.5% following the CPI report, but gained 2.4% by the close. This was then followed up on Friday with a decline of 2.3% following a rejection of the daily 20 SMA.
On the monthly time frame, the S&P 500 is flat with a rejection of higher prices earlier in the month. On the weekly time frame, the S&P 500 is displaying volatility at the weekly 50 SMA, with a range of over 6% during the week. On the daily time frame, price continues to look bearish with price trading well below the 20, 50 and 200 SMA. As mentioned above, price rejected the 20 SMA on Friday. The outlook for the S&P is to watch for further price action at the weekly 50 SMA.
The volatility in the S&P 500 was seen across the markets, with wild swings in the Nasdaq 100 and Dow Jones indices. The Nasdaq 100 declined 3.1% over the week, whilst the Dow Jones gained 1.2%. All US Indices are trading below their 50 SMA.
This week the FTSE 100, the UK index, declined by 1.9% and is now trading below the weekly 200 SMA. The support level at 6788 we mentioned last week is currently holding; but should this level fail, the next level of support is the prior year’s low at 6397.
OUTPERFORMING ASSET FOR THE WATCHLIST
W.R. Berkley Corporation - WRB
R. Berkley Corporation is a commercial lines property & casualty insurance holding company organised in Delaware and based in Greenwich, Connecticut. The company operates commercial insurance businesses in the United Kingdom, Continental Europe, South America, Canada, Mexico, Scandinavia, Asia and Australia and reinsurance businesses in the United States, United Kingdom, Continental Europe, Australia, the Asia-Pacific region and South Africa.
WRB is a stock that has been in a long-term trend, but the quality of the trend has been mixed. This stock performed well during 2019 and, more recently, following a breakout above last year’s high in February, price has been bullish with a gain of 24%.
On the weekly time frame, the Sublime trend filter is green. Price is trading above the 50 and 200 SMA. Three weeks ago price found support at the 50 SMA and has since gained 9%.
On the daily timeframe below, price is trading above the 20, 50 and 200 SMA, and the moving averages are aligned. The Sublime trend filter is green. This week price created an all-time high at $73, before pulling back on Friday, which is not unexpected as price never moves in a straight line. Given the recent market decline throughout 2022, this stock has been a clear outperformer and should be on every investor’s watchlist.
Looking ahead, WRB has earnings on 24th October. A break and close above the all-time high, whilst watching price movement around earnings, could provide our Phoenix community with opportunities in a stock with a history of solid trends.
OUTPERFORMING ASSET FOR THE WATCHLIST
Singapore Dollar Versus Japanese Yen - SGDJPY
SGDJPY is the relative currency unit value of the Singapore Dollar against a unit of Japanese Yen in the foreign exchange market. SGDJPY has a history of long-term trends as seen during 2006-7, 2012-15 and through 2021-22. This history provides confidence that trends are likely to continue in the future.
On the monthly time frame, price has been in a strong trend since price broke above last year’s high in March 2022 at 85.4. Since then price has gained 22%.
On the weekly time frame, price is in an uptrend. Price is trading above both the 50 and 200 SMA, and the Sublime trend filter is green.
Whilst on the daily time frame, since March 2022 price has been using the zone between the 20 and 50 SMA as support. Following a retest of the 100 round number on 22nd September, price has been particularly bullish with a gain of 4% in 15 trading days.
Looking ahead, a continuation pattern above the current all-time high could offer our Phoenix community members an opportunity in a good-performing asset. The next area of resistance is the 150-round number.
Looking Ahead
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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The ST Team
