An interesting week with the S&P 500 following the Dow Jones by printing yet another record ATH but ending the week bearish. Given the recovery in price from the low of the recent pullback at the start of March, a pullback was due particularly with the $4000 round number still acting as resistance.
The recovery from the recent pullback has seen a number of new stocks being picked up through our scanning and analysis process that are breaking out from consolidation and also printing new ATHs.
These have been shared with our Phoenix members through our signal service with some of the better-looking stocks making it into the portfolio.
The immediate future requires patience as price on the S&P 500 contends with the $4000 round number. There is likely to be resistance for the short-term at least which will see weakness in stocks and where remaining calm, having a process with risk and stop-losses well managed and applying patience are all to be applied. This is where the majority struggle.
If there is further weakness, we will look to manage our open positions. If and when price breaks and closes above the $4000 round number, we will add further stocks and compounds into the portfolio.
The mistake that many make is to try and predict what happens next. We let price dictate. Simple, effective and very profitable.
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.
And with that said, let’s get into this week’s newsletter…
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
- Ashtead Group – AHT
- Alliance Trust – ATST
- Next – NXT
- American Express – AXP
- Ameriprise Financial – AMP
- Berkshire Hathaway – BRK.B
- Burlington Stores – BURL
- Cigna – CI
- Honeywell International – HON
- Nike – NKE
FTSE 100
Little change on the FTSE 100 with price still holding above the 2018 support level but the month of March is still trading in the consolidation formed since the start of the year.
The weekly timeframe sees price still trading below the 200sma as resistance and above the 50sma as support. The Sublime trend filter still remains green.
On the daily timeframe below, price is above the 20sma, the 50sma and the 200sma and the Sublime trend filter continues to remain green from last week. However, we can clearly see the consolidation price is still trading in. We await a breakout to the upside particularly a move through the 200sma on the weekly timeframe and the 7000 round number. Once these areas have been confirmed as support, we are likely to see price push towards the current ATH. We will continue to focus on the stocks outperforming the indices.
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
A move of around 10% to the upside so far in March taking price onto further new ATHs. Price has now moved up over 43% since the breakout in November.
The weekly continues to display bullishness with price trading above the 50sma and the 200sma and the Sublime trend filter remaining green.
On the daily timeframe below, we can see the new ATHs being printed this week as well as the quality of the trend in clarity. Price is well supported by the 20sma and the 50sma if needed. The 200sma continues to angle up confirming a bullish bias. Friday is a day of profit-taking so we are likely to see a bearish end to the week before further strength as we move through 2021 but given how far price has moved since last year, a correction is due. We will continue to share signals with our Phoenix members.
Alliance Trust – ATST
A stock that has the potential to trend but it can be a bumpy ride. Price has moved around 300% from around £2.40 in 2008 to just under £9.50 this year. Price is now pushing to break out from consolidation which it has been in since 2019. This will act as a base for the next leg up.
The weekly timeframe is confirming bullishness. Price is trading above the 50sma and the 200sma and the Sublime trend filter is green.
On the daily timeframe below, price is trading above the 20sma, the 50sma and the 200sma and the trend filter is also green. A potential double bottom if confirmed is a continuation pattern of the bull trend. There is bullish alignment across all 3 timeframes. We have already shared signals with our Phoenix members this year and are now waiting for the breakout for us to start sharing further signals and compounding opportunities. A break and close above the £10 major round number ahead of price will be significant for further strength.
Next – NXT
A stock that has been on our radar since December when price first retested the current ATH set back in 2015. A move of over 850% from the low of 2008 at just under £8 to the high of just over £81 in 2015 shows why this is on our watchlist.
The weekly timeframe is showing signs of strength with the Sublime trend filter being green and price trading above the 50sma and the 200sma.
The daily timeframe below confirms that with price trading above the 20sma, the 50sma and the 200sma. In recent days, price has bounced off support set back in 2019 and is now back to retesting the current ATH. However, this means all very little until we get a breakout. The trend filter is grey so price is yet to confirm bullishness and the 20sma is yet to move back above the 50sma. This stock has excellent upside potential but not until both a breakout and a trend continuation has been confirmed. We will be standing aside for now but monitoring closely.
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
Record ATHs were printed this week but the $4000 round number continues to act as resistance. Thursday printed a bearish day so with Friday often synonymous with profit-taking, we may see further weakness before the week ends. This battle between the bulls and the bears is commonplace at these key levels but recent history has shown that the bulls come out on top.
Little change on the weekly timeframe with price trading above the 50sma and the 200sma and the trend filter is green.
On the daily timeframe below, price is fully aligned with the weekly timeframe with price trading above the 20sma, the 50sma and the 200sma and the trend filter remaining green this week. A close above the MAs by the end of Friday will be a strong sign that the bulls are very much in control of the market. We await the $4000 round number to be confirmed as support.
American Express – AXP
A move of over 110% between March 2020 and March 2021 from around $66 to just over $140 is why we are monitoring this stock since being picked out by our scanners. Price since 2020 has been trading in consolidation recovering from the declines of last year when the impact of CV19 first hit the markets. March so far has seen a move of around 2.80% to the upside which has taken price onto new ATHs.
The weekly timeframe is showing signs of strength with the Sublime trend filter being green and price trading above the 50sma and the 200sma.
The daily timeframe below shows price pulling back to retest resistance-turned-support. The Sublime trend filter is green and price is trading above the 50sma and the 200sma. We are monitoring this closely but given price’s proximity to the $150 round number, we are either likely to stand aside until price moves above $150 or we execute our pullback strategy from support sharing this with our Phoenix members. We will let price dictate what course of action to take.
Ameriprise Financial – AMP
A 20%+ move to the upside since breaking out from consolidation in November of last year. We have positions in play since price broke and closed above $200 sharing signals with our Phoenix members. March so far has been a slow month with price trading inside consolidation.
On the weekly timeframe, price is trading above the 50sma and the 200sma and the Sublime trend filter is green confirming a bull trend is in play.
On the daily timeframe below, the bull trend is confirmed with price trading above the 20sma, the 50sma and the 200sma with all 3 MAs angling up and the Sublime trend filter being green. The current trend in play has been well supported by the 20sma and the 50sma. Thursday’s price action saw a complete intraday reversal which may lead to further weakness on Friday. We will continue to hold our long position and will compound on the next breakout.
Berkshire Hathaway – BRK.B
A good history of performance, broken out from consolidation, good volume and printing new ATHs since last month are the reasons why we shared an entry signal with our Phoenix members this week.
On the weekly timeframe, price trading above the 50sma and the 200sma and the trend filter is green confirming a bull trend is in play.
On the daily timeframe below, price moved over 15% from the breakout before the pullback of this week to the 20sma where price is now finding support coupled with the $250 round number. The 50sma and the 200sma are below price angling up confirming bullishness and that the movement of price action this week is nothing more than a pullback for now. The next breakout will suggest a continuation towards $300. We have an interest in this stock based on what our technical analysis says and not because of Warren Buffett. We remain neutral towards stock names and their CEOs and let price guide our decision, a lesson many would do well following. There is no room for emotions and favourites in investing.
Burlington Stores – BURL
Another recent stock with a good history of performance shared with our Phoenix members. This has been justified by a move of over 16% to the upside so far this month taking price above $300 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 a bull trend is in play.
On the daily timeframe below, price is trading above the 20sma, the 50sma and the 200sma and the trend filter is green confirming bullish alignment across all 3 timeframes. This week has seen price weaken towards the $300 round number to retest it as support as can be expected with round number levels. We await the next breakout and a push towards $350 when we will share compounding signals with our Phoenix members.
Cigna – CI
A move of around 2700% from around $8 in 2008 to $230 in 2018 is why this stock is on our watchlist trending very well during that period. A move of over 15% so far this month has taken price out of a period of consolidation it has been in since 2018 and onto new ATHs and why this is being picked up by our scanners. The longer the consolidation the bigger the breakout and given its past performance, this has excellent upside potential.
On the weekly timeframe, price is confirming the start of the next bull run with price trading above support, above the 50sma and the 200sma and the Sublime trend filter is green.
On the daily timeframe below, we can see the move up that has taken price out of consolidation. The Sublime trend filter is green and price is trading above the 20sma, the 50sma and the 200sma. All 3 MAs are angling up confirming the start of a bull trend. We are now waiting for this to meet our trading plan to start sharing signals with our Phoenix members. Jumping in too early leaves you open to a fake breakout so patience for now.
Honeywell International – HON
A 745% move up between 2009 and 2020 from $20 to $180 shows why this stock was added to our portfolio in December of last year. Price broke out from consolidation in November but it was the break and close above $200 that alerted us to an entry point which we took. Since then price has been stuck in consolidation. March has seen a move up of over 6% printing a new ATH.
On the weekly timeframe, the Sublime trend filter has remained green throughout this period of consolidation and above the 50sma and the 200sma.
On the daily timeframe below, we can see the consolidation price has been in since the gap up due to earnings in November confirmed with the Sublime trend filter alternating between green, grey and red. Since the start of 2021, price has worked its way back up after using the high of the gap as support and is now attempting to break out and push to new ATHs. A good example of what a stock does after entry is out of our control and how patience is rewarded. The longer the consolidation, the bigger the breakout so no love lost here. We will restart sharing signals with our Phoenix members once price starts pushing towards $300.
Nike – NKE
A slow-moving stock since the most recent breakout from consolidation in August of last year when price moved above $100. Price has still managed to move around 40% since then to just short of $150. We have a position in the portfolio since October but have been standing aside from adding further positions due to the trend structure in play.
On the weekly timeframe, price is still trading above the 50sma and the 200sma and the trend filter is green.
On the daily timeframe below, price is trading above the 20sma, the 50sma and the 200sma and the trend filter has turned back to green this week. Price has been trading inside a period of consolidation since the high of December and which is why we have been standing aside. Pre-market shows a gap down on Friday which we ideally want to see filled intraday. Another example of patience needs to be applied for stocks to come good but the rewards are well worth the wait. A break and close above $150 and we will start sharing signals again with our Phoenix members.
The week started with a new all-time high in the S&P then price started to pull back. At the time of writing, price is finding support but this may be subject to change. If we see a bounce from support that takes price above $4000 then we should see a surge in the number of stocks breaking out.
We have interesting times ahead of us and the potential to have a really profitable year. You don’t want to be missing out on opportunities in the market so don’t forget to join our FREE Launchpad Facebook group.
Keep it simple. Keep it Sublime.
The ST Team
