Sublime trading

A volatile week that would have the unsophisticated investor panicking but which seasoned investors with a proven process are accustomed to.

Price never moves in a straight line and it shows a lack of alignment with the natural movement to price to expect that. There are periods of boom in the market when investors open positions and accumulate profit and there are periods of correction when investors stand aside and protect their capital. Understanding the seasonal movement to price helps immensely with this.

We go into more detail on aligning yourself with price action in our new Launchpad course which is priced at £49.95 but regular readers to our newsletter will be able to access it for just £4.95 using the code ‘launchpad’.

In this week’s newsletter, we look at how stocks that are being filtered out by our scanning process and making it into the Phoenix signal service are being impacted by the declines of this week.

Overall, our stance continues to remain bullish and we, in fact, take the stance where people are panicking, good investors apply patience and look to buy at good support levels.

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

  • Ashtead Group – AHT
  • Polar Capital Technology Trust – PCT
  • Scottish Mortgage Investment Trust – SMT

US Stocks

  • Ameriprise Financial – AMP
  • Cadence Design Systems – CDNS
  • Deere & Co – DE
  • Disney – DIS
  • Electronic Arts – EA
  • Idexx Laboratories – IDXX
  • Martin Marietta Materials – MLM

FTSE 100

Despite the declines of this week, price continues to trade above the 2018 support level which we would like to see price close above by the end of trading on Friday. This will then suggest that price has the very real potential to break out above the numerous resistance levels ahead of price.

No change on the weekly with price still trading between the 50sma as support and the 200sma as resistance and the Sublime trend filter continues to remain green confirming bullishness despite price being range-bound for now.

On the daily timeframe below, price is above the 200sma and around the support level of June 2020 but the weakness on Friday has taken price below the 20sma and the 50sma. The trend filter is grey confirming a sideways market. Overall, we still continue to hold bullish positions for now with support holding strong.

The UK stocks that have made it onto this week’s newsletter are: (click on charts to open in a new window)

UK STOCKS

Ashtead Group – AHT

Price has moved over 30% since breaking out from consolidation. Price this month had moved a further 11% to the upside moving through the £40 round number but as expected we are seeing some resistance.

The weekly timeframe continues to display bullishness with price trading above the key moving averages of the 50sma and the 200sma and the Sublime trend filter is green confirming a bull trend is still very much in play.

On the daily timeframe below, price is also above the key moving averages of the 20sma, the 50sma and the 200sma and the Sublime trend filter continues to remain green confirming alignment between the 2 timeframes. We continue to share signals with our Phoenix members but will be standing aside until price breaks out and pushes towards the £50 round number.

Polar Capital Technology Trust – PCT

Price has attempted to but has struggled to gain momentum above the high of last year. Price broke through again this month as it did last month but looks like price will be closing bearish and below the 2020 high by the end of trading on Friday.

On the weekly timeframe, the 11% drop in price since last week has taken price near the 50sma where it is currently finding support. Price comfortably remains above the 200sma but the trend filter has turned grey due to this current pullback.

On the daily timeframe below, we can see the decline in more detail with price attempting to break through the 200sma intraday on Friday but looking likely to be closing above by the end of trading on Friday. A close above this major moving average is a strong sign that price is finding support. A bounce off this level would ideally see price move back above the 20sma and the 50sma and onto new ATHs towards the £30 round number.

Scottish Mortgage Investment Trust – SMT

Given that price had moved 120% since the breakout from consolidation in April of last year, it is not surprising we are seeing such an aggressive correction. February has seen a reversal in price of around 20% from the high of the month which would have many panicking. Good investors remain calm and follow a proven process.

The weekly timeframe continues to display bullishness with price trading above the key moving averages of the 50sma and the 200sma and the Sublime trend filter is green confirming a bull trend is still very much in play.

On the daily timeframe below, the declines of this week has seen price move below the 20sma and the 50sma and the trend filter has turned red. However, price is finding support at the high of the range formed back between October and November of last year as can be seen by the long wicks below this week’s candles. Phoenix members will have managed their positions accordingly with profit locked in. We now stand aside until the next set up.

YES, I Want Access To The Monthly Top Stocks!

Now is the perfect time to start preparing for when stocks do make a move. A recovery in this index will mean we can start looking to place long trades. Further declines and we can start looking to short stocks like we did back in 2008.

The market is poised to hand out some unique opportunities for excellent profit and growth for those who have learned to position themselves correctly.

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

Price has remained range-bound since printing a new ATH at the start of the month and is likely to stay within consolidation by the end of trading on Friday. Price overall is still very much bullish and is supported by some major levels immediately below price which includes the high of last year.

The weekly timeframe continues to display bullishness with price trading above the key moving averages of the 50sma and the 200sma and the Sublime trend filter is green confirming a bull trend is still very much in play.

On the daily timeframe below, the pullback of this week has turned the trend filter grey taking price below the 20sma but finding immediate support at the 50sma at the time of writing. Ideally, we would like to see price close above the 50sma by the end of trading on Friday which will suggest further strength to the upside. Directly above price is the $4000 round number which if cleared will be a huge step forward for new ATHs. We continue to remain bullish and have used this opportunity to enter some pullback positions with minimal risk attached. Patience for now.

US STOCKS

Ameriprise Financial – AMP

A stock that had moved over 15% since we first started sharing signals with our Phoenix members last month before the pullback this week. There is little to suggest that this stock is anything but bullish for now.

The weekly timeframe continues to display bullishness with price trading above the key moving averages of the 50sma and the 200sma and the Sublime trend filter is green confirming a bull trend is still very much in play.

On the daily timeframe below, price is also above the key moving averages of the 20sma, the 50sma and the 200sma and the Sublime trend filter continues to remain green confirming alignment between the 2 timeframes. We now simply need to apply patience and wait for the next breakout to the upside before considering any more positions which may potentially be when price clears $250.

Cadence Design Systems – CDNS

A stock that has moved around 70% when we first entered around $90 last year to $150 where it is currently finding resistance. Price is only just holding above the high of last year which we want to see price close above by the end of trading on Friday.

The weekly timeframe continues to display bullishness with price trading above the key moving averages of the 50sma and the 200sma and the Sublime trend filter is green confirming a bull trend is still very much in play.

On the daily timeframe below, we can see the consolidation price has been in this year despite printing new ATHs this month. The trend filter is grey confirming that price trading around the 20sma and the 50sma. Overall, our bias is still bullish with price finding support at the high of November and with price trading above the 200sma. We will monitor this stock closely and will guide our Phoenix members through the signal service as price dictates how.

Deere & Co – DE

One of the few stocks that has held very well during this recent pullback and continues to print new ATHs with a move of around 20% to the upside this month. Price is now faced with the $350 round number which is very likely to act as resistance even if it is for the short-term.

The weekly timeframe continues to display bullishness with price trading above the key moving averages of the 50sma and the 200sma and the Sublime trend filter is green confirming a bull trend is still very much in play.

On the daily timeframe below, price is also above the key moving averages of the 20sma, the 50sma and the 200sma and the Sublime trend filter continues to remain green confirming alignment between the 2 timeframes. We have been in this stock and sharing signals with our Phoenix members since $200. We will continue to manage our positions as price dictates.

YES, Let me watch now!

Disney – DIS

A stock we are monitoring closely for the Phoenix signal service once this meets our trading plan. This is a stock that performed very well for us back between 2012 and 2015 and had since been in an area of consolidation before the recent breakout in December.

The weekly timeframe is displaying bullishness with price trading above the key moving averages of the 50sma and the 200sma and the Sublime trend filter is green confirming the start of a bull trend.

On the daily timeframe below, price is also above the key moving averages of the 20sma, the 50sma and the 200sma and the Sublime trend filter is green confirming alignment between the 2 timeframes. Price, however, is currently finding resistance at the $200 round number which is why we are seeing a pullback in price. This is very likely to be temporary but we need price to dictate that by breaking and closing above the current ATH of February to suggest a trend continuation towards $250 and when the signal service will be updated with both BO and PB entries.

Electronic Arts – EA

AA stock that has performed well for us in periods in the past during the 1300% rise in price between $10 in 2012 to $150 in 2018. Since 2018, price has remained in consolidation, which will act as an excellent base for the next leg up, once price does break out.

The weekly timeframe continues to display bullishness with price trading above the key moving averages of the 50sma and the 200sma and the Sublime trend filter is green confirming a bull trend is still very much in play.

On the daily timeframe below, we can see the pullback of this week with the current ATH still acting strong forcing price down by around 10%. Price is still trading above the 200sma confirming the bias is still bullish but the pullback this week has taken price below the 20sma and the 50sma and the trend filter has turned red suggesting bearishness. For now, price is still in consolidation but one we are closely monitoring for the Phoenix signal service as assets breaking out from long-term consolidation will move to the top of our watchlist.

Idexx Laboratories – IDXX

A stock that has moved over 90% since the breakout in May of last year from $300 to just short of $600 where it is currently finding resistance causing the pullback of this week.

The weekly timeframe continues to display bullishness with price trading above the key moving averages of the 50sma and the 200sma and the Sublime trend filter is green confirming a bull trend is still very much in play.

On the daily timeframe below, price is also above the key moving averages of the 20sma, the 50sma and the 200sma and the Sublime trend filter continues to remain green confirming alignment between the 2 timeframes. The pullback of this week sees price finding immediate support at the 20sma which we would ideally like to see hold strong and force price back to the upside. As long as price remains above $500, we are likely to see a breakout to the upside but we need to see price dictate that. We will continue to guide our members through the Phoenix signal service.

Martin Marietta Materials – MLM

A new stock to the newsletter and one we have recently added to the Phoenix signal service. This stock trended very well between 2003 and 2007 with a 560% move to the upside from $25 to $170. Since then price has gone on to create new highs with price now trading around $330 but trends have been choppy. However, the current trend in play following the recovery from CV19 shows that trend structure could be regaining its linearity. February has seen a move of over 16% at the time of writing this taking price onto new ATHs.

The weekly timeframe continues to display bullishness with price trading above the key moving averages of the 50sma and the 200sma and the Sublime trend filter is green confirming a bull trend is still very much in play.

On the daily timeframe below, price is also above the key moving averages of the 20sma, the 50sma and the 200sma and the Sublime trend filter continues to remain green confirming alignment between the 2 timeframes. Price is finding immediate resistance at the $350 round number. A break and close above this level will suggest further strength and when we will add further signals into the portfolio.

The FTSE failed to close another month above a major support/resistance level and at the time of writing, the S&P is showing signs of a trend continuation. February has been an interesting month and I am sure the momentum will flow into the next month. Look out for next week’s newsletter to see how the market performs in the first week of March.

Keep up to date with the markets in our FREE Launchpad Facebook group.

Keep it simple. Keep it Sublime.

The ST Team


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