Tag: Confirmed Uptrend

Market View

Posted on by Raj Gupta

The U.S. market remains in a Confirmed Uptrend. The S&P 500 and Nasdaq rallied strongly this week, with the
Nasdaq now positive for the year. The next level of resistance for the S&P 500 is the flattening 200-DMA at
~3,000, while the Nasdaq faces resistance at ~9,315. Support for both indices remains the rising 10- and 21-
DMA. Distribution has been a non-factor with both indices at just two days.
Energy, Technology, and Consumer Cyclical led this week, each rising more than 6%. Ten of 11 sectors are now
trading above their respective 50-DMA, up from just five last week. Top ranked industry groups outperforming

over the last week include Enterprise Software, Database Software, Financial Software, Software Security, Semi-
conductors, Electronic Measuring, Internet, and Biotech. 73% of S&P 500 stocks are now trading above their re-
spective 50-DMA, up from 51% last week.

China A Shares

Posted on by Sandeeep N

The CSI 300 rose 1.3% this week in three trading sessions due to the holiday. The market remains in a Confirmed Uptrend with two distribution days. The index broke above key resistance at the 100-DMA on higher volume Friday, boosted by positive headlines that China and the U.S. are talking about the phase-one trade deal and that China is further opening up its financial market. The CSI 300 has hit a new high since March’s low and retaken all key moving averages. We are becoming more bullish and recommend investors buy ideas that have broken out of solid bases or bounced off key support levels with good volume. Meanwhile, focus on names with strong fundamental profiles. The CSI 300 is on track to test resistance near the upper gap (3,987‒4,028). We see immediate support at the 100-DMA (-0.58%), followed by the 200-DMA of ~3,896 (-1.7%) and the 50-DMA of ~3,848 (-2.9%). Most sectors recorded gains this week, with Consumer Staple and Technology outperforming while Financial and Transportation lagged.

US Focus

Posted on by Sandeeep N

The U.S. market remains in a Confirmed Uptrend. The S&P 500 and Nasdaq rallied strongly this week, with the Nasdaq now positive for the year. The next level of resistance for the S&P 500 is the flattening 200-DMA at ~3000, while the Nasdaq faces resistance at ~9315. Support for both indices remains the rising 10- and 21-DMA. Distribution has been a non-factor with both indices at just two days.

Market View

Posted on by Raj Gupta

U.S. Market
The U.S. market remains in a Confirmed Uptrend. The S&P 500 and Nasdaq reversed off early week gains to
close flat for the week. Despite a sharp pullback Friday, both indices avoided distribution as volume came in below Thursday’s spike. Distribution now stands at two and three days, respectively, with one set to expire on the
S&P 500 next week. Support remains the rising 21-DMA on both indices (S&P 500: 2,797; Nasdaq: 8,421).
Lagging sectors led this week with Energy, Consumer Cyclical, and Basic Material rising +2% each, while Retail,
Health Care, and Utility fell 2–4% each. Five of 11 sectors are trading 1% or more above their respective 50-
DMA, with three trading just below that level. Top ranked groups outperforming this week include Financial Software, Enterprise Software, Internet, Computer Tech Services, Beverages, Cleaning Products, Discount Retail,
Managed Care, and Mining. 51% of S&P 500 stocks are trading above their respective 50-DMA, up from 38%
last week.

China A Shares

Posted on by Sandeeep N

The CSI 300 rose 3.04% this week on a four-day gaining streak and rose 6.14% this month. The market remains in a Confirmed Uptrend with three distribution days (two expired). The index retook its 50- and 200-DMA in two successive days and volume picked up although remained below average. We would like 200-DMA support to hold to remain constructive. The CSI 300 is testing immediate resistance at its 100-DMA (+0.6%), followed by the gap at ~4,028 (+3.0%). Beijing has eased its epidemic control measures and the annual meetings of the National People’s Congress and the Chinese People’s Political Consultative Conference will be held May 22, raising expectations that economic recovery will speed up and more fiscal stimulus will be imminent. China’s official manufacturing PMI in April slipped to 50.8 from March’s 52.0, while the Caixin survey, which focuses mostly on small and export-oriented businesses, fell to 49.4, suggesting the pandemic shattered global demand. Our conviction has increased following Thursday’s resistance break and we recommend buying ideas that emerged from sound bases or key support levels with volume.

US Focus

Posted on by Sandeeep N

The U.S. market remains in a Confirmed Uptrend. The S&P 500 and Nasdaq reversed off early week gains to close flat for the week. Despite a sharp pullback Friday, both indices avoided distribution as volume came in below Thursday’s spike. Distribution now stands at two and three days, respectively, with one set to expire on the S&P 500 next week. Support remains the rising 21-DMA on both indices (S&P 500: 2,797; Nasdaq: 8,421).

European Focus

Posted on by Sandeeep N

On Thursday, the Stoxx 600 ended 3.17% above last Friday’s close. Of the 17 indices that we cover 16 are in a Confirmed Uptrend, and one is in an Uptrend Under pressure.

Market View

Posted on by Raj Gupta

U.S. Market
The U.S. market remains in a Confirmed Uptrend. The S&P 500 and Nasdaq are consolidating gains with low
distribution. The S&P 500 is trading at its 50-DMA, while the Nasdaq is trading at its 100-DMA. Distribution
stands at one day each, not including Thursday’s stalling action. The 21-DMA remains a key level of short-term
support.
Four of 11 O’Neil sectors are trading above their respective 50-DMA, with leadership largely isolated among
Technology and Health Care stocks. Despite Energy leading over the last five sessions, the sector remains 6%
below its 50-DMA. Top ranked industry groups outperforming over the last week include Mining, Biotech, Diversified Health Care, Pharmaceuticals, Medical Products/Equipment, Medical Software, Enterprise Software, Gaming Software, Semiconductors, Telecom, and Internet. 38% of S&P 500 stocks are now trading above their respective 50-DMA, up from 30% last week.

China A Shares

Posted on by Sandeeep N

The CSI 300 fell 1.11% this week on lower volume. The market remains in a Confirmed Uptrend with five distribution days. The index has hit resistance at its 50-DMA and is consolidating after hitting highs following March’s low of 3,503 (-7.7%). With consistently thin trading volume, we expect the market to trade sideways between resistance and the gap of ~3,738 (-1.5%) in the near term. We would like it to stay above 21-DMA support to remain constructive, followed by support at ~3,627 (-4.5%). China further cut its benchmark lending rate this week to support the economy amid the pandemic and raised expectations of a comprehensive rate cut. However, since the coronavirus spread overseas has not yet peaked and unprecedented oil price declines boosted fears of a recession, the domestic market is in a wait-and-see mood. As volatility picks up and rotation speeds up, investors are advised to stay cautious and focus on ideas that benefit from policy support, mainly targeted at stimulating domestic consumption. The Consumer Staple, Health Care, and Retail sectors are outperforming while Technology lagged over the last four weeks. With earnings to continue next week, we recommend watching closely.

US Focus

Posted on by Sandeeep N

The U.S. market remains in a Confirmed Uptrend. The S&P 500 and Nasdaq are consolidating gains with low distribution. The S&P 500 is trading at its 50-DMA, while the Nasdaq is trading at its 100-DMA. Distribution stands at one day each, not including stalling action on Thursday. The 21-DMA remains a key level of short-term support.