Welcome to our weekly newsletter, where we offer insights into stock setups that we share with our Phoenix members.
Last week the markets pulled back to areas of support, and we commented in that newsletter that we anticipated areas of support to hold and the markets to rebound. This week we have seen that expectation hold, resulting in strong moves across the board in the direction of the trend.
To recap on last week’s learning lesson – price never moves in a straight line: breakouts and pullbacks are all part of the markets ‘breathing’. As seasoned traders, we expect and embrace these cycles. Many traders and investors would have panicked last week and closed positioned, resulting in an unrealised profit, or losses.
At Sublime Trading, we have a clear trading plan that governs our approach. This is the value of our education programme, where we teach members the right techniques to manage in all market conditions.
Let’s get into this week’s newsletter!
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Here are 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
On the monthly time frame, as we have discussed for several months, price has struggled to close above the pivot high from 2015 at 7124. In November price initially showed strength, but weakened, resulting in an indecision candle. In December the strength has resumed, and we wait to see if this can be sustained to the close of the month (and end of the year).
On the weekly time frame, the Sublime trend filter is green, switching from grey last week. Price is trading above the 50 and 200 simple moving averages (SMA).
On the daily time frame below, after a strong move, this week price is back above both the 20 and 50 SMA, along with the 200 SMA. The Sublime trend filter this week also switched from grey to green, indicating strength. Our overall bias remains bullish, and we continue to look for stocks outperforming the Index.
UK STOCKS
Experian - EXPN
A stock with a mixed history, but a new breakout and all-time high could result in a trend emerging. Price in December has been particularly bullish with an 8% gain and an all-time high at £36.71.
On the weekly time frame, on 18 October this year price broke above a key pivot level. Price initially continued higher before stalling at the previous all-time high and pulling back to the daily 50 SMA. The Sublime trend filter is green and price is trading above the 50 and 200 SMA.
On the daily timeframe below, price is above the 20, 50 and 200 SMA, and the Sublime trend filter is also green, confirming alignment with the weekly timeframe and between the moving averages. The next area of resistance is the £40 round number. A break and close above this level will suggest further strength, and we will update Phoenix members if we consider entries for the portfolio.
Ferguson – FERG
A stock that has moved higher over time, but in the past has suffered deep pullbacks. On the monthly time frame, October reversed September’s decline with a bullish engulfing candle and a 6.4% gain. The strength continued in December with a further 7.7% gain to date.
On the weekly time frame, price is trading above the 50 and 200 SMA, and the Sublime trend filter is green.
On the daily time frame below, price is above the 20, 50 and 200 SMA, and the Sublime trend filter is also green. All MAs are currently neatly aligned, and the 20 SMA is moving away from the 50 SMA, indicating a linear trend. This week price created a new all-time high at £164.61. We will continue to share trading opportunities in this stock with our Phoenix community members. The next area of resistance is the £200 round number.
Rightmove - RMV
A stock with a history of trends but with mixed performance in recent years. Between 2010 to 2013 price was in a linear trend. However since then price has moved higher, but with deep pullbacks along the way. Price in November and December has been bullish with gains of 8% and 4% respectively.
On the weekly timeframe, price is trading above the 50 and 200 SMA, and the Sublime trend filter is green.
On the daily timeframe below, the Sublime trend filter is green and price is above the 20, 50 and 200 SMA. The strength this month has resulted in an all-time high at £7.83. A continuation pattern above the recent high could offer Phoenix members an opportunity before the next level of resistance, being the £10 round number.
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S&P 500
Following September’s seasonal decline, in October the bulls took back control with a gain of 7.0%. In November price initially showed strength, but subsequently weakened. December initially showed weakness, but strength has resumed in the past week, resulting in a modest 2.1% gain to date.
On the weekly time frame, price continues to trade above the 50 and 200 SMA, and the Sublime trend filter remains green.
On the daily time frame below, this week price bounced off the zonal area of support at the key pivot level of 4550, which coincided with the 50 SMA. This week the Sublime trend filter switched from grey to green. Our overall view remains unchanged, that the bulls remain in firm control of the S&P and, as a result, we continue to look for stocks that are outperforming the index.
US STOCKS
Apple - AAPL
Apple is one of the most popular stocks in the NASDAQ. It has a history of impulsive trends but does suffer periods of pullback and consolidation. On the monthly time frame, price was bullish following the pandemic where price moved from $60 to $130. However, since then the trend has been less linear. In November price broke out to create an all-time high, however, price subsequently pulled back to retest the previous year high at $139. Since then price has been bullish, with gains in November and December of 10% and 6% respectively.
On the weekly time frame below, price is in a long-term uptrend with price trading above both the 50 and 200 SMA, and the Sublime trend filter is green.
On the daily time frame below, price retreated during September to retest the previous year high at $139, then price climbed higher creating a series of higher highs and higher lows, culminating in an all-time high this week. The Sublime trend filter is green, and price is trading above the 20, 50 and 200 SMA. This stock has been discussed several times in the Phoenix community. A continuation pattern above the current all-time high could provide further opportunities before the $200 round number, the next area of resistance.
Keysight Technologies - KEYS
A stock with a long history of trends going back to 2016. This month price created an all-time high at $204. The bullish momentum is showing few signs of slowing with an 8% gain in November followed up with a 3.5% gain to date in December.
On a weekly timeframe, price is trading above the 50 and 200 SMA, and the Sublime trend filter is green.
On the daily timeframe below, price is trading above the 20, 50 and 200 SMA, and the Sublime trend filter is also green. Since price broke above the previous all-time high in February 2021, price has been bullish. Price suffered a pullback in September but regained strength in October, and the momentum has continued throughout November and December. If price can form a level of support at the $200 Round number, the next area of resistance is the $300 round number. A continuation pattern above the current price could offer Phoenix members further opportunities in this high-performing stock.
Lowes Companies - LOW
A stock with a long history of trends going back to 2016. This month price created an all-time high at $260. The bullish momentum is showing few signs of slowing with price gaining 44% since it broke above the previous year high in March this year.
On a weekly timeframe, price is trading above the 50 and 200 SMA, and the Sublime trend filter is green.
On the daily timeframe below, price is trading above the 20, 50 and 200 SMA, and the Sublime trend filter is also green. Since October price has been particularly bullish, using the 20 SMA as support. The next area of resistance is the $300 round number. A continuation of higher highs and higher lows gives us confidence that a strong trend is in place. We will continue to discuss opportunities in this stock with our Phoenix community members.
Life Storage – LSI
A stock with a history of sustained trends running for multiple years. Recently, since price broke above the previous year high at $80 in February this year, price has gained 75%. In December, to date, price has gained 6.5% and created an all-time high at $143.
On the weekly timeframe, price continues to trade above the 50 and 200 SMA, and the Sublime trend filter remains green.
On the daily timeframe, price is above the 20, 50 and 200 SMA, and all moving averages are angling up, demonstrating a strong trend is in play. The Sublime trend filter remains green. When price initially broke above the previous year’s high at $80, it formed a linear trend, however it suffered a pullback in September, where it formed a double-bottom, before resuming the trend. A breakout above the all-time high could offer further opportunities to Phoenix members. The next major area of resistance is the $200 round number.
Mid-America Apartment Communities – MAA
A stock in a long term trend and during recent months has displayed good momentum. Since breaking above the previous year’s high at $149, price has been bullish with a gain of over 46%.
On the weekly timeframe, price is above the 50 and the 200 SMA. The Sublime trend filter is green.
On the daily timeframe below, the Sublime trend filter is green, and price is above the 20, 50 and 200 SMA. As mentioned, since breaking out from resistance in April this year price has been bullish, using the 20 SMA as support. The next major area of resistance is the $300 round number. We will update our Phoenix community of any further developments in this stock.
McDonald’s - MCD
A stock with a mixed history of trends and long periods of consolidation. To date, December is displaying a bullish candle with a gain of 7.5%, resulting in a new all-time high at $263.
On the weekly time frame, price is above the 50 and 200 SMA and the Sublime trend filter is green.
On the daily time frame below, price is above the 20, 50 and 200 SMA and the Sublime trend filter is also green, confirming alignment with the weekly timeframe. Over recent months the periods of consolidation have been shorter, indicating that this stock may be ready to form a linear trend. Following this most recent breakout, price has bounced off a minor pivot level and formed a strong rebound. We will monitor the stock for signs of a linear trend, and update our Phoenix community accordingly. The next area of resistance is the $300 round number.
Tractor Supply Company - TSCO
This is a stock that has been traded in the Phoenix community since price broke above the $150 round number and the previous year’s high at $156. Since then, price has formed a bullish move to the upside, culminating in an all-time high this week at $236.
On the weekly time frame, price is trading above the 50 and 200 SMA, and the Sublime trend filter is green.
On the daily time frame below, this week price bounced off the 20 SMA, to create an all-time high. Price is above all moving averages; 20, 50 and 200 SMA and the Sublime trend filter is green. Phoenix members will continue to monitor this stock for further opportunities. The next major area of resistance is the $300 round number.
This week the markets have rebounded strongly from defined areas of support, which is to be expected. We will continue to monitor our positions, and act according to our trading plan, including taking new opportunities and compounding existing positions.
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Keep it simple. Keep it Sublime.
The ST Team
