Welcome to 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 in our portfolio, including a discussion on the returns the asset generates for our Phoenix members.
Let’s get into this week’s newsletter!
US & UK INDICES OVERVIEW
This week the US indices continued the strong start to 2023. On the monthly time frame, January closed with a gain of 5.9%, almost entirely reversing the decline of December. The bulls have maintained control in February, with a gain to date of 1.6%. This week was notable as the S&P closed above the December high at 4101. On the weekly time frame, price retested the 50 SMA before regaining strength. Whilst on the daily time frame, price remains above all moving averages. Notably, the moving averages are all aligned and beginning to diverge. Our position remains unchanged; we continue to look for high-performing stock in high-performing sectors.
Last week the Nasdaq 100 had a substantial gain of 3.3%, however, the moving averages are not fully aligned, with the 20 and 50 SMA aligned but below the 200 SMA. The Dow Jones is a mixed picture, with last week resulting in a decline of 0.2%.
This week the FTSE 100, the UK index, had a strong week with a gain of 1.8%. The strength in January continued in February resulting in the FTSE 100 creating an all-time high of 7907.
OUTPERFORMING ASSET FOR THE WATCHLIST
Stryker Corporation - SYK
Stryker Corporation is an American multinational medical technologies corporation based in Kalamazoo, Michigan. Stryker’s products include implants used in joint replacement and trauma surgeries; surgical equipment and surgical navigation systems; endoscopic and communications systems; patient handling and emergency medical equipment; neurosurgical, neurovascular and spinal devices; as well as other medical device products used in a variety of medical specialities.
SYK is a stock with a history of long-term trends dating back to 2013. Price created an all-time high in September 2021 before entering a period of consolidation until May last year when it declined to $200. It has subsequently rebounded, with strong gains since November. On the monthly time frame, price this month has been very bullish with a gain of 11.6%, resulting in an all-time high of $284.
On the weekly time frame, price is trading above the 50 and 200 SMA, and the Sublime trend filter is green. The Sublime trend filter is also green on the daily time frame. Price is currently trading above all moving averages, which are aligned and diverging – a sign of near-term strength.
Looking ahead, a continuation pattern above the all-time high, along with the formation of a linear trend, could present opportunities for our Phoenix community members.
OUTPERFORMING ASSET FOR THE WATCHLIST
Quanta Services - PWR
Quanta Services 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. Its operating companies achieved combined revenues of about $11 billion in 2018. It is headquartered in Houston, Texas. In 1998, Quanta went public on the New York Stock Exchange and was added to the S&P 500 index in June 2009.
PWR is a stock our Phoenix community traded successfully throughout 2020 and 2021 when the stock increased by over 200%. Since October 2021 price action has been mixed, but climbing. In December price created an all-time high of $155 before weakening. In January the bulls regained control to challenge the all-time high.
On the weekly time frame, price is trading above the 50 and 200 SMA, and the Sublime trend filter is green. The Sublime trend filter is also green on the daily time frame. Price is currently trading above all moving averages. This week the 20 SMA crossed above the 50 SMA, a sign of near-term strength.
Looking ahead, we will monitor the current price action. A continuation pattern above the all-time high and the formation of a linear trend could present opportunities for our Phoenix community members in a stock that has delivered a good profit in the past.
Last week’s momentum was again prevalent this week, resulting in continued strength in 2023. Whilst we remain vigilant, there are early signs our patience throughout 2022 could be rewarded with another healthy bull run in equities. We continue to share ideas with our Phoenix community for excellent returns.
Keep it simple. Keep it Sublime.
The ST Team
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