Welcome to our weekly newsletter, where we offer insights into stock setups that we share with our Phoenix members.

In recent weeks we have observed strength returning to the markets following September’s anticipated pullbacks. This week we have seen that strength result in a new round of all-time highs in the US indices and a long-awaited breakout from consolidation in the FTSE. As a result, our patience has been rewarded.

In this week’s newsletter, we focus on stocks that have rebounded strongly following September’s pullbacks and, in turn, demonstrate why trend trading is so powerful. 

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, during October price has shown bullishness, with a gain to date of 2.3%. As we have discussed for several months, price has struggled to close above the pivot high from 2015 at 7124. However this month price is currently displaying a breakout, but we must wait until the completion of the month to fully assess price action.

On the weekly time frame, the Sublime trend filter is green, and price is trading above the 50sma and 200sma.

On the daily time frame below, price has continued to trade above all moving averages; 20sma, 50sma and 200sma. The Sublime trend filter this week has maintained green, a continued sign strength is building. The week price broke above the key pivot level at 7224 and performed a mini re-test. Our overall bias remains bullish, and we continue to look for stocks outperforming the Index.

UK STOCKS

Ashtead Group - AHT

A trending stock we have repeatedly discussed in this newsletter and with our Phoenix community.

September’s pullback was 14.3%, whilst the rebound to date has been 13.4%.

The Sublime trend filter is green on the weekly time frame, and price remains above the 50sma and 200sma. This week price created an all-time high close.

On the daily time frame below, the Sublime trend filter is green. This week price traded above the 20sma, 50sma and 200sma, and, importantly the 20sma crossed the 50sma – the ‘golden cross’. The next area of resistance is the all-time high at £62.84, followed by the £100 major round number. We will continue to update our Phoenix community on this high-performing stock.

Croda International - CRDA

A stock we have been successfully trading since last year.

September’s pullback was 13.4%, whilst the rebound to date has exceeded the pullback, with a gain of 16.7%.

On the weekly time frame, price is trading above the 50sma and 200sma, and the Sublime trend filter is green.

On the daily time frame below, price is trading above the 20sma, 50sma and 200sma, however, the 20sma remains below the 50sma. This week the Sublime trend filter has returned to green. The last time this stock broke out from resistance (May this year) it trended for several months. The next area of resistance is the £100 round number. If the trend can re-emerge, opportunities could develop which we will share with our Phoenix community.

 

Ferguson – FERG

A stock that has moved higher over time, but in the past has suffered deep pullbacks.

September’s pullback was 6.8%, whilst the rebound to date has exceeded the pullback, with a gain of 9.1%.

On the weekly time frame, price is trading above the 50sma and 200sma and the Sublime trend filter is green.

On the daily time frame below, price is above the 20sma, 50sma and 200sma, and the Sublime trend filter is green. All MAs are currently neatly aligned, and the 20sma is moving away from the 50sma. indicating that a linear trend could be forming. This week price closed above £110, creating an all-time high. As price was recently in a period of resistance for 50 days, we will apply patience and assess the next breakout. We will share any breakout or pullback signals with our Phoenix members.

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

The month of September closed with a bearish engulfing candle and a decline of 4.9%. This represents the first monthly decline since January this year. In October the bulls took back control, reversing September’s decline, with a gain of 6.4% and a new all-time high.

On the weekly time frame, price continues to trade above the 50sma and 200sma, and the Sublime trend filter remains green.

On the daily time frame below, this week price again performed strongly resulting in a new all-time high at 4599. The Sublime trend filter is green, and price is trading above all moving averages. The 20sma is currently crossing the 50sma, the ‘golden cross’ previously mentioned. 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

Arista Networks – ANET

Another relatively new stock, with a history in two parts; a trend was in place between November 2016 – February 2018 where price increased by over 200%, followed by a long period of consolidation up to May 2021. Price broke above the pivot high from April 2019 at $331 in May 2021 and has subsequently formed a strong trend.

September’s pullback was 11.7%, whilst the rebound to date has exceeded the pullback, with a gain of 20.1%.

On the weekly time frame, the Sublime trend filter is green. Price is trading above the 50sma and the 200sma. This week price closed above $400 for the first time in its history and created an all-time high.

On the daily time frame below, price is above the 20sma, 50sma and 200sma, and the MA’s are neatly aligned. The Sublime trend filter is green. This stock has earnings next week. We will apply patience and assess price action following this event. Should price form a linear trend, the next area of resistance is the $500 round number.

Cadence Design Systems - CDNS

CDNS is a popular stock in our Phoenix community, with members holding multiple positions. 

September’s pullback was 14.1%, whilst the rebound to date has exceeded the pullback, with a gain of 16.5%.

On the weekly time frame, price is trading above the 50sma and 200sma and the Sublime trend filter is green.

On the daily time frame below, price is currently trading above the 20sma, 50sma and 200sma. The Sublime trend filter is green. Price recently created a new all-time high, and not unexpectedly pulled back to retest a minor pivot level. Phoenix members will be watching the stock closely to see if further opportunities present themselves in this high-performing stock.

KKR & Co - KKR

A cheap stock with a mixed history of performance, but one that has performed extremely well following the recent pullback. 

September’s pullback was 12.9%, whilst the rebound to date has exceeded the pullback, with a gain of 35.0%.

On the weekly time frame, price continues to trade above the 50sma and 200sma, and the Sublime trend filter remains green. 

On the daily time frame below, we can see that price has taken off in recent weeks. This chart demonstrates that price can move quickly at any time, and as trend traders, we need to remain vigilant and ready to act. Price is above the 20sma, 50sma and 200sma, and the Sublime trend filter is currently green. This stock has earnings next week. We will apply patience and assess price action following this event. Should price form a linear trend, the next area of resistance is the $100 major round number.

Microsoft - MSFT

A stock with an impressive trend going back to July 2016! 

September’s pullback was 8.8%, whilst the rebound to date has exceeded the pullback, with a gain of 16.2%.

On the weekly time frame, price is trading above the 50sma and 200sma, and the Sublime trend filter continues to be green, confirming the bull trend. This week’s gain to date of 4.9% is the largest weekly gain since April this year.

On the daily time frame below, the Sublime trend filter has quickly returned to green, with a gain of 11% in two weeks. Price is currently above the 20sma, 50sma and 200sma. With the recent move, price is back above the $300 round number. This week earnings gave price a boost. Phoenix members will continue to monitor this stock for further opportunities. The next area of resistance is the $400 round number.

Nvidia - NVDA

Nvidia has been one of the best-performing stocks in the Phoenix portfolio.

September’s pullback was 16.5%, whilst the rebound to date has exceeded the pullback, with a gain of 28.3%.

This stock was discussed in detail in last week’s newsletter. A strong performance this week has provided further healthy returns with ROI gains currently at over 2,100%!

NVDA is a good example of the power of trend trading – simple, time-efficient and highly profitable. This example demonstrates that a trader only needs a few such trades each year to generate extremely good returns.

Looking ahead, NVDA is maintaining its position above the moving averages on both the weekly and daily time frames. Price this week crashed through the previous all-time high at $230. The next ahead of resistance is the $300 round number. We will continue to monitor this stock and discuss further compounding opportunities with our Phoenix community.

Prologis - PLD

A stock with a mixed history of trends along with short, sharp pullbacks.

September’s pullback was 11.9%, whilst the rebound to date has exceeded the pullback, with a gain of 19.0%.

On the weekly time frame, price continues to trade above the 50sma and 200sma, and the Sublime trend filter remains green. 

On the daily time frame below, price has recovered strongly following the recent pullback. The Sublime trend filter is green, and price is trading above the 20sma, 50sma and 200sma. This week the 20sma crossed the 50sma. Price is immediately faced with resistance at the $150 round number. A break and close above this level and a continuation pattern will be of interest to Phoenix members.

Sherwin-Williams Company - SHW

Another stock with a mixed history of trends along with short, sharp pullbacks.

September’s pullback was 12.9%, whilst the rebound to date has exceeded the pullback, with a gain of 18.7%.

On the weekly time frame, price continues to trade above the 50sma and 200sma, and the Sublime trend filter remains green. 

On the daily time frame below, price has also recovered strongly following the recent pullback. The Sublime trend filter is green, and price is trading above the 20sma, 50sma and 200sma. This week the 20sma crossed the 50sma. Price has responded positively to this week’s earnings created an all-time high at $324. As this stock has been in the latest period of consolidation for 70 days, we need to apply some patience. A break and close above this recent breakout level followed by a continuation pattern could offer Phoenix members an opportunity in this stock.

This week the markets have rewarded our patience with breakouts across the board, resulting in all-time highs in the indices. Whilst the FTSE has broken out from a long period of resistance. As a result, our Phoenix members will continue to compound and add more positions to their already profitable portfolios.

To get up to speed on how to accurately analyse the markets, consider completing the ‘Are You On Track To Retire Wealthy’ scorecard and unlock your FREE gift – Lifetime access to the Launchpad Investor Starter Kit priced £297 (+ VAT). 

Keep it simple. Keep it Sublime.

The ST Team


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