A week when the S&P 500 has printed yet another new ATH and when stocks continue to recover from pullbacks with many breaking out and offering further entry points for the portfolio.
We are still working our way through earnings season and so we continue to apply caution on stocks that are yet to release their figures but on those stocks where earnings have come and gone and breaking out, we are sharing signals with our members and adding them into our portfolio if they meet the criteria clearly laid out in our Phoenix investment plan.
Overall our bias is bullish and our portfolio has moved further into profit with the recovery and the breakouts over the last trading week but with the S&P 500 closing in on the $4000 round number, we will monitor our positions very closely tightening stop-losses if needed.
There are a number of stocks breaking out from a lengthy period of consolidation, several of which have been in our portfolio since last year, that are likely to push on and trend well throughout the rest of 2021 but again that is very much dependent on how the S&P 500 reacts to the $4000 round number.
We will continue to focus on the best-performing stocks, those out-performing the indices, until then.
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
- Allianz Technology Trust – ATT
- Dechra Pharmaceuticals – DPH
- Polar Capital Technology Trust – PCT
US Stocks
- Ameriprise Financial – AMP
- Cadence Design Systems – CDNS
- Fortinet – FTNT
- Paypal – PYPL
- RingCentral – RNG
- Starbucks – SBUX
- Texas Instruments – TXN
FTSE 100
February remains bullish with a move of 2% to the upside but little change from last week with price remaining inside a range and still struggling to break through key resistance ahead from 2018.
The weekly shows price continuing to trade between the 50sma as support and the 200sma as resistance and the trend filter remains green confirming the trend is still bullish despite price consolidating.
On the daily timeframe below, price is still also trading above the 200sma confirming a bullish bias but below the 20sma and the 50sma confirming price is going sideways. The 20sma has also just dipped below the 50sma, a death cross, which in some circles would prompt short traders to jump in which at this stage would be a huge mistake. MAs tend to criss-cross above and below each other when an asset is consolidating and should not be taken as a sign to short a market which is how a lot of people lose a lot of money. To short a market, we want to see price move below the 200sma first. For now, our stance overall remains bullish and we will continue to focus on strong performing stocks.
The UK stocks that have made it onto this week’s newsletter are: (click on charts to open in a new window)
UK STOCKS
Allianz Technology Trust – ATT
February continues to display bullishness with a circa 12% move to the upside taking price onto new ATHs. With price holding above £30, we are likely to see the momentum push price towards £40.
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. A strong end to the week could mean another BO on the daily timeframe but being a Friday, there could also be profit-taking. We need to see how the week ends to make our decision going forward. This is not the neatest of trends but signals being shared with our Phoenix members since last year. A slow but reliable mover which is good to balance out a portfolio if loaded with faster-moving stocks.
Dechra Pharmaceuticals – DPH
A stock that meets all our criteria. A good history of performance with price moving over 300% from £7 to £31 between 2014 to 2018. Price then moved into a lengthy period of consolidation which it broke out of in September last year. The consolidation will act as a base for a trend to develop. Price has since moved around 16% from the breakout meaning the trend is still new.
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. The trend in play since March has been choppy but this is likely to neaten out since it is trading out of consolidation and printing new ATHs. Price has also displayed a continuation chart pattern at the start of the year above the support level of October 2020 so one to keep an eye out for further strength to the upside. The next breakout will be significant and when we will start considering signals for our Phoenix members. However, £40 above price will act as resistance being a round number.
Polar Capital Technology Trust – PCT
Around an 8% move to the upside in February has seen price print a new ATH but has yet to gather momentum to push price further up towards £30.
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. We have been sharing signals with our Phoenix members and have positions in our portfolio since June of last year but the swings in price since July have meant we have been standing aside and managing our open positions. Now that price is trading out of consolidation, if a neater more linear trend materialises, we will consider adding more positions into the portfolio. The £30 round number above price will act as resistance but this is likely to be short-term if the bulls remain in control.
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
Further strength in February sees price setting records with further new ATHs with a move of over 5% so far this month but momentum is slow given the time of year. Price is now closing in on that major round number of $4000 which we ideally want to see price make light work of, similar to how the Dow Jones reacted to the $30,000 round number since November.
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. The next breakout and how price reacts to $4000 is crucial and so will monitor our open positions very closely for declines deeper than we would like if $4000 proves too strong at the first time of asking. Our stance, for now, remains bullish.
US STOCKS
Ameriprise Financial – AMP
A new stock added to the portfolio and shared with our Phoenix members through the signal service having moved over 9% to the upside this month printing a new ATH. This stock has a history of performing well, broke out of consolidation in November and had moved around 30% since the breakout taking price through the $200 round number in the 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, 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. The trend is a little choppy but now that it is trading out of consolidation, this is likely to neaten up. We will monitor this for both BO and PB opportunities going forward. Early signs suggest there is plenty of upside potential to this stock with $250 being the first level above price that we would like to see price move towards.
Cadence Design Systems – CDNS
A move of over 10% this month has added to the 60% move to the upside since $90 which is when we first added this tech stock into our portfolio. Price is now closing in on $150 which we want to see a break and close above and then further strength towards $200.
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. A breakout on Thursday confirms that price is looking to push higher. We will continue to monitor this stock and share positions with our Phoenix members. This has been a top performer for us although the trend has been choppy since September. We would like to see a more linear trend emerge but will also be open to pullback opportunities.
Fortinet – FTNT
A stock that has moved over 220% since 2018 from $50 to almost $165. February has seen a rise of around 13% taking price through $150 in the process. However, not all is rosy as the history of this stock shows wild swings meaning this could be a bumpy ride going forward.
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. Price has broken out from consolidation which started back in May 2020 which will act as a base for a trend to develop. Price is yet to pull back to retest the resistance-turned-support level in the form of the high of the consolidation so we will be standing aside on this for now. We will then consider positions once this meets our investment plan with pullback opportunities being a very real possibility given the structure of how this asset moves.
Paypal – PYPL
No stranger to the weekly newsletter given how well this has been performing since the recovery from CV19. Price has moved over 250% from the low of March last year from $80 to $300 this month where it is now finding immediate 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. A positive reaction to earnings injected further momentum into the trend but Thursday saw an intraday reversal with $300 acting as resistance. This is very likely to be short-term so we will apply patience for now until a break and close above $300 when we will then start sharing further signals with our Phoenix members.
RingCentral – RNG
An expensive stock, one that is now trading above $400 with a move of over 16% so far this month adding to the 1580% move to the upside since 2017 when price was just a little over $20. A hugely rewarding stock that on the whole has performed very well rewarding investors with excellent profit. This is now priced at $430 and so a break and close above $500 will be a significant step for further strength to the upside.
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. Price this week has broken out of a mini area of consolidation it had been in since December which was expected given that price was trading around a round number. This will now form a base for the next leg up and when we will filter for the best high-probability signals to share with our Phoenix members.
Starbucks – SBUX
Further strength this week has seen the ground lost in January already recovered this month with a move of around 11% to the upside taking price back above $100, a major round number.
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 turned back to green this week after turning grey and red during the pullback. Price is yet to break out above the high of January which if and when it does, the strength is very much with the bulls as the recovery from the recent pullback shows, price is likely to push towards $150, the next area of resistance and a round number. We are poised to share further signals with our Phoenix members as this is a stock that ticks all our criteria to be added to the portfolio.
Texas Instruments – TXN
A move of over 8% this month has added to the 30% move to the upside since the breakout from consolidation in August. We have been sharing signals on this stock since last year particularly with price breaking out from consolidation which since formed was using $100 as support.
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. This stock has a very good history of performing well and so really is a no-brainer for the portfolio. The current trend also seems to be settling down into a much neater linear trend with less deep swings which we would like to see stay constant going forward. We will continue to share signals with our Phoenix members particularly if price breaks and closes above $200 and continues on its ascent.
Another strong week in the markets and earnings continues to push price even higher. We should continue to see bullish moves into the next week as we are off to a strong start for 2021. There are many stocks still recovering from pullbacks so we should see more breakouts in the coming days and weeks.
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Keep it simple. Keep it Sublime.
The ST Team
