Author: Raj Gupta

Raj Gupta is Director, Research Analyst. After joining the firm in 2002 as a research analyst, Raj was appointed senior equity analyst in 2006, and lead senior equity analyst in 2014—largely because of his ability to select outperforming stocks. He acts as an expert in the O’Neil Methodology and contributes to the direction of product and service line development. He recommends securities for addition to or removal from the U.S. Focus List, or USFL, and the associated alerts to clients. During his tenure, he was part of the leadership that developed the Global Focus List, which marked the firm’s successful expansion into international equity recommendations. He is also a lead on the IPO Rewind report and contributes to weekly summaries on the performance of the U.S. market. Much of his expertise is delivered as highly customized service to clients. RAj earned his Bachelor’s degree in Economics from the University of California, Santa Barbara. He began working at the firm directly out of college, driven by his passion for investing and stocks. An avid soccer player, he built and managed an adult league in the Los Angeles area, in which he still plays. He also enjoys international travel; he and his wife commit to at least one major adventure a year.

Market View

Posted on by Raj Gupta

The market status remains Uptrend Under Pressure. Distribution remains relatively low on both the S&P 500 and
Nasdaq, however, no days will expire next week. Further, the S&P 500 and Nasdaq are now both trading below
their respective 50-DMAs for the first time since the election. Leadership, for the most part, has held up well,
though multiple ideas have pulled back into their respective bases after breaking out over the last few weeks.
This warrants a cautious approach until we see support come back into the market. We will be looking
for 2300, or the 100-DMA, to now act as support on the S&P 500.

Stocks on our U.S. Focus List—Current Sentiment
Our USFL of 54 names lost 1.3% on average this week, underperforming the S&P 500 (-1.1%) and the
Nasdaq (-1.2%).

By Sector
Technology was a mixed picture this week. Software/Cloud-related ideas continue to hold up well, with many
bucking the pressure of the general market. RNG, RP, RHT, PAYC, VEEV, and ADBE continue to trade at or
near new highs while MDSO and CRM have constructively pulled back into their respective pivots. Semiconductors,
on the other hand, are now testing their 50-DMAs after pulling back this week. All seven ideas (AMAT,
AVGO, CAVM, IPHI, MCHP, MPWR, MTSI) are now consolidating and forming new bases. Banks (CFG, FRC,
MS, WAL) held March lows but continue to lag the general market. They continue to be in focus with multiple
ideas reporting earnings next week.

Market View

Posted on by Raj Gupta

The market status remains in an Uptrend Under Pressure. The S&P 500 and Nasdaq continue to hold above
their respective 50-DMAs, but have been unable to clear resistance. Distribution now stands at four days on the
S&P 500 and three on the Nasdaq. One additional day is set to expire on the Nasdaq Monday and on the S&P
500 Tuesday. Leadership outside of Banks continues to hold up well, with several making new highs in the face
of market pressure. We view this as constructive internal action, but still need to see the S&P 500 clear above
2390 before moving the market back into a Confirmed Uptrend.

Stocks on our U.S. Focus List—Current Sentiment

Our USFL of 54 names (including three net additions) lost 0.4% on average this week, roughly in-line
with the S&P 500 (-0.3%) and the Nasdaq (-0.6%).

By Sector

Technology ideas across the USFL stood out on the week. Cloud-related companies outperformed, with multiple
ideas hitting new highs. ADBE, RP, PAYC, and VEEV continue to trade constructively near new highs, while new
ideas CRM and MDSO broke out this week. The Banks, on the other hand, continue to lag heading into earnings
next week. They have managed to hold the lows from March, but the RS lines and A/D Ratings continue to
fall. We are looking for a big volume surge back through their respective 50-DMAs to change the current concerning
move lower.

Market View

Posted on by Raj Gupta

The market status remains in an Uptrend Under Pressure. The S&P 500 and Nasdaq retraced last week’s sell-off, bouncing directly off their respective 50-DMAs for the first time since the election. Still, each index remains just below resistance levels (S&P 500: 2390; Nasdaq: 5928) that will need to be cleared before we shift the market back into a Confirmed Uptrend. With distribution falling and leadership continuing to act well, this is likely to occur early next week.

Stocks on our U.S. Focus List—Current Sentiment

Our USFL of 51 names (including two additions) gained 1.6% on average this week, outperforming the S&P 500 (0.8%) and the Nasdaq (1.4%).

By Sector

Banks were able to find support this week, constructively bouncing off January lows, though most still remain below their respective 50-DMAs. FRC and WAL rallied over 3% and now each are sitting just below resistance. A handful of Retail ideas within the list acted well, with OLLI breaking out on earnings, PLAY holding its pivot after an initial earnings move lower, and continuing into new highs. AMZN also broke out from consolidation and quickly became extended above its pivot. Commercial Services ideas CRTO and WAGE lagged on the week. CRTO continues to hold trend, while WAGE is still holding above longer-term support at $70.

Market View

Posted on by Raj Gupta

The market status remains in an Uptrend Under Pressure. The S&P 500 and Nasdaq retraced last week’s sell-off, bouncing directly off their respective 50-DMAs for the first time since the election. Still, each index remains just below resistance levels (S&P 500: 2390; Nasdaq: 5928) that will need to be cleared before we shift the market back into a Confirmed Uptrend. With distribution falling and leadership continuing to act well, this is likely to occur early next week.

Stocks on our U.S. Focus List—Current Sentiment

Our USFL of 51 names (including two additions) gained 1.6% on average this week, outperforming the S&P 500 (0.8%) and the Nasdaq (1.4%).

By Sector

Banks were able to find support this week, constructively bouncing off January lows, though most still remain below their respective 50-DMAs. FRC and WAL rallied over 3% and now each are sitting just below resistance. A handful of Retail ideas within the list acted well, with OLLI breaking out on earnings, PLAY holding its pivot after an initial earnings move lower, and BURL continuing into new highs. AMZN also broke out from consolidation and quickly became extended above its pivot. Commercial Services ideas CRTO and WAGE lagged on the week. CRTO continues to hold trend, while WAGE is still holding above longer-term support at $70.

Market View

Posted on by Raj Gupta

The market remains in a Confirmed Uptrend, with three distribution days on the S&P 500 and Nasdaq. The total count remains low, though no distribution days will expire for over two weeks. The S&P 500 and Nasdaq are each holding support along their respective 21-DMAs as leadership ideas continue to surface. Removals from the list were largely isolated to one group. Therefore, we remain positive on the general market as long as these short-term levels of support continue to hold, and distribution remains under control.

Stocks on our U.S. Focus List—Current Sentiment

Our USFL of 48 names lost 0.6% on average this week, underperforming the S&P 500 (-0.4%) and the Nasdaq (-0.1%).

By Sector

For a third straight week, Health Care ideas within the USFL outperformed. UNH and CELG remain actionable, while IDXX, ALGN, and NUVA continue to trend into higher highs. Home builders are breaking out across the board, with many becoming quickly extended. PHM quickly moved 5% above its $22 pivot, but can be added to on pullbacks to its 21-DMA. Semiconductors, which have slowed in recent weeks, rallied Friday sending SOXX into new highs. New addition, CAVM, remains actionable, while AVGO and AMAT continue to hit new highs. Conversely, the Mobile Manufacturing and RV industry group took a big hit this week after THO reported earnings. PATK and LCII were subsequently removed from the list.

Market View

Posted on by Raj Gupta

The market remains in a Confirmed Uptrend, with two distribution days on the S&P 500 and three on the Nasdaq. One distribution day is set to expire on each index at the close Monday. Leadership continues to emerge across several sectors, while few ideas have shown concerning technical weakness. Therefore, we re-main constructive on the market as long as short-term levels of support continue to hold, including the 21-DMA, while distribution remains light.

Stocks on our U.S. Focus List – Current Sentiment

Our USFL of 48 names (including four additions) gained 1.4% on average this week, outperforming the S&P 500 (0.67%) and the NASDAQ (0.44%).

By Sector

Building-related industry groups across several sectors stood out this week.  IBP was the clear leader, jumping over 20%.  This led to breakouts across the homebuilders including new USFL addition PHM.  Defense companies also led, with HEI breaking out of a flat base into new highs after reporting better – than – expected earnings.  Lastly, Health Care ideas acted well for a second straight week.  IDXX, ALGN, and NUVA continue to trade into new highs, while UNH broke out of a flat base on above average volume.  CELG continues to form the right side of a Stage One flat base.

Market View

Posted on by Raj Gupta

The market has begun to consolidate gains that we have seen over the last several weeks. We are looking for distribution to stay low, for price to hold above support levels, and for leadership to consolidate constructively above moving average support. Should the market pullback, we will be looking for the 21-DMA on both the S&P 500 and Nasdaq to hold. This level has been tested numerous times since the election and will likely be the market’s first test before the 50-DMA. We remain in a Confirmed Uptrend, still with only one distribution day on the S&P 500 and two on the Nasdaq.