As we enter the second-quarter earnings season, we already see gaps in the market in the direction of and against the established bullish trend.
We have specified rules in our community to deal with these periods of the year. These rules:
- Prevent us from entering during low-probability environments.
- Prevent losses which we avoid through applying patience.
- Prevent us from getting stopped out prematurely.
During the build-up to earnings release, most panic and start selling off positions. This is an account-crippling mistake.
Having a proven set of rules promotes patience and confidence. This, in turn, rewards good investors with further growth and compounding opportunities post-earnings.
This all stems from the foundation of good investing which is being able to choose high-probability stocks. These stocks will often gap in the direction of the trend on earnings release or swiftly recover from gaps against the trend.
Get the foundation wrong, which most do, and you will always struggle.
April looks like ending as a positive month for the bulls in both the UK and US stock markets. Commodities and currencies in our portfolio have also had a positive month.
Friday is generally a day of profit-taking. We are likely to see bearish activity, but the signs are there for a strong bull run through May.
Let’s get into this week’s newsletter!
The FREE Facebook Community called the Launchpad is a great place to get involved in conversations
around stocks mentioned in this newsletter and opportunities that may arise during the week.
Here is how the best performing UK & US stocks, as picked out by our scanning process, have
performed this week.
For a glossary of terms click here.
OUTPERFORMING STOCKS COVERED THIS WEEK
UK Stocks
US Stocks
FTSE 100
At the time of writing, price is still just under 4% bullish for the month, finding resistance at the 7000 round number and the weekly 200sma.
On the weekly timeframe, the Sublime trend filter continues to remain green.
On the daily timeframe below, we can see the consolidation zone price currently finds itself in with the above levels acting as resistance, and the high of January of this year and the 20sma acting as support. We need to see a breakout. As our bias has been bullish since last year, we continue to remain bullish, favouring a breakout to the upside. We will let price dictate the breakout and react accordingly. We will continue to add the best-performing stocks into the portfolio.
UK STOCKS
888 Holdings - 888
A stock that does not have the most convincing history of performance with trends being short-lived. However, the recovery from CV19 has seen price move over 550% from 70p to a high of £4.60. Since March, price has been printing new ATHs. April has seen price move over 9%.
On the weekly timeframe, price continues to trade above the 50sma and the 200sma. The Sublime trend filter remains green.
On the daily timeframe below, price continues to trade above the 20sma, the 50sma and the 200sma. All 3 MAs are angling up, confirming a bull trend. The 20sma and the 50sma have both been doing their job as support during this bull run. The next breakout will confirm further strength. The £10 round number is where price is likely to target. We will continue to share signals with our Phoenix members.
Croda International - CRDA
A stock that we first shared signals on with our Phoenix members in October of last year when price cleared the £60 round number. Early signs were promising, with price falling just short of the £70 round number by the following month. However, since then price has remained in consolidation until a fake breakout earlier this month.
On the weekly timeframe, price is trading above the 200sma, and the 50sma and the Sublime trend filter is green, confirming the emergence of a bull trend.
On the daily timeframe below, we can see the consolidation price has been stuck in. The Sublime trend filter had been alternating between green, grey and red during this period, confirming a sideways market. The most recent leg up was a result of price bouncing off the 200sma as support last month. The MAs are aligned, and the Sublime trend filter has been green since the start of April. We now await a break and close above the £7 round number. We will then resume sharing signals with our Phoenix members and consider placing further compounds.
Intermediate Capital Group - ICP
Price goes from strength to strength with another new ATH for the month, pushing price to over 6% to the upside for April.
On the weekly timeframe, price continues to trade above the 50sma and the 200sma. The Sublime trend filter remains green.
On the daily timeframe below, at the time of writing, price had broken out from the mini consolidation it had been in since mid-April. We now want to see price continue its climb towards the $5000 round number. This will cause stocks to break out and continue to push to new ATHs. Patience is a skill that is poorly practised but one that is handsomely rewarded when executed correctly. We will continue to focus on and add the best-performing bullish stocks into the portfolio.
If you have watched the 4-part series and are keen to get started, then book yourself in for a 1-2-1 call with a member of the Sublime Trading team. |
S&P 500
March closed around 3.5% bullish. A significant step for price closing above support for the first
time in 4 months.
On the weekly timeframe, price continues to trade between the 50sma as support and the 200sma
as resistance and the Sublime trend filter continues to remain green.
On the daily timeframe below, price closed above the 20sma, the 50sma and the 200sma by the
end of trading for the month and the Sublime trend filter closed green. However, price still remains
in consolidation with the Sublime trend filter alternating between green, grey and red since late
last year. Price is also still faced with a number of key resistance levels. We will continue to scan for
stocks that are performing better than the index.
US STOCKS
Ameriprise Financial - AMP
A move of around 12% for the month, pushing price above $250. Price has now moved over 40% since the breakout from consolidation in November last year.
On the weekly timeframe, price continues to trade above the 50sma and the 200sma. The Sublime trend filter remains green.
On the daily timeframe below, price is trading above the 20sma, the 50sma and the 200sma and the Sublime trend filter is green. Another breakout confirmed on Thursday is likely to see price now push towards the $300 round number. This has been in the portfolio since February when price broke and closed above $200. Signals being shared with our Phoenix members.
Berkshire Hathaway - BRK.B
A move of just under 9% so far in April pushing price further onto new ATHs. Price has now moved over 18% since the breakout from consolidation in February.
On the weekly timeframe, price continues to trade above the 50sma and the 200sma. The Sublime trend filter remains green.
On the daily timeframe below, price is trading above the 20sma, the 50sma and the 200sma and the Sublime trend filter is green. We have multiple positions in play following our first pullback entry at support last month. Thursday’s bar produced another breakout signal as price continues to push towards $300. Phoenix members are being kept up-to-date with signals and compounding opportunities.
Equifax - EFX
A stock that performed very well between 2011 and 2017 with a move of almost 400% from $30 to $150. Since then, price has pushed further up but price action has been choppy. April has seen price move around 26% taking price above the high of last year, above $200 and onto new ATHs.
On the weekly timeframe, price continues to trade above the 50sma and the 200sma. The Sublime trend filter remains green.
On the daily timeframe below, price is trading above the 20sma, the 50sma and the 200sma and the Sublime trend filter is green. A gap up on earnings was the catalyst for the significant moves of this month. We now want to see price remain above the gap and target $300. We will share signals with our Phoenix members once our investment plan has been met. Patience needed for now as we let price settle into a trend.
Facebook - FB
2018 and the scandal surrounding Facebook is very much in the past, with this stock now priced at around $330. Price during the scandal had dropped to $120. April has seen a move of 9% taking price out of consolidation and onto new ATHs.
On the weekly timeframe, price is trading above the 50sma, and the 200sma and the Sublime trend filter is green, confirming the emergence of a bull trend.
On the daily timeframe below, we can see the gap up from earnings this week which is likely to add the momentum that price needs to target $400. We will monitor this and add signals with our Phoenix members.
KKR & Co - KKR
A cheap stock at just under $60 displaying good upside potential. This is despite a choppy history of performance. Price has moved over 65% since the breakout in July of last year. Over 16% of the bull run has been added in April.
On the weekly timeframe, price continues to trade above the 50sma and the 200sma. The Sublime trend filter remains green.
On the daily timeframe below, price is trading above the 20sma, the 50sma and the 200sma and the Sublime trend filter is green. The most recent period of consolidation has acted as an excellent base for this bull run through April, another example of why we always look for emerging trends from sideways markets. Signals are being shared with Phoenix members.
Marsh & McLennan Companies - MMC
A move of over 700% from $17 in 2009 to $135 today shows why this stock should feature in a good investor’s portfolio. April has seen price move around 12.5% taking price onto new ATHs.
On the weekly timeframe, price continues to trade above the 50sma and the 200sma. The Sublime trend filter remains green.
On the daily timeframe below, price is trading above the 20sma, the 50sma and the 200sma and the Sublime trend filter is green. This has shot out of the blocks since breaking out from consolidation and will target $200 as the next key area of resistance. Signals being shared with our Phoenix members.
Old Dominion Freight Line - ODFL
A move of over 8% in April, taking price to over 21% to the upside since the breakout from consolidation in February. A stock with a solid history of performance and current price action is following suit.
On the weekly timeframe, price continues to trade above the 50sma and the 200sma. The Sublime trend filter remains green.
On the daily timeframe below, price is trading above the 20sma, the 50sma and the 200sma and the Sublime trend filter is green. The 20sma has been acting as support, as it often does when price is in a trend. The next breakout will push price towards the $300 round number. Signals being shared with Phoenix members.
We saw some good breakouts yet again this week but the indices are slowing in momentum. Earnings season is pushing individual stocks in either direction but we should start to see the indices continue the overall bullish trend. Stay up to date with market events by joining our FREE Launchpad Facebook group.
Keep it simple. Keep it Sublime.
The ST Team
