Software (IGV): The software benchmark dropped 4.7% last week, the largest weekly decline in nearly 10 months. The index
breached support at its 10- and 21-DMA and is likely to test support at its 50-DMA ($379). Quantitative metrics have only weakened
slightly, with numerical A/D Rating still positive and Up/Down Volume ratio above 1. Notably, RS line peaked in early December and
has failed to make a new high. Within the six software groups present in the top 50 O’Neil groups, only two (Computer SftwrFinancial and Computer Sftwr-Edu/Media) showed an improvement in Group Rank over the past four weeks. Monitor stocks that are
extended from key moving average supports and vulnerable to further decline. Reduce exposure to stocks breaching logical levels of
long-term support. Expect the IGV to consolidate further on a breach of its 50-DMA.
Author: Romeo Alvarez
Romeo Alvarez is a senior equity analyst at William O’Neil + Co., a registered investment advisor serving 400 top-performing institutional portfolio managers worldwide. The firm employs 150 associates in Los Angeles, New York, Boston, and London.
Based in the firm’s Los Angeles office, Mr. Alvarez is a senior equity analyst covering the Americas region and a member of the Global Focus List Committee, which approves all equity recommendations for developed, emerging, and frontier markets. Romeo also selects equity initiations to be covered in the Technology sector and regularly reports to clients on innovation and technology developments in Trend Watch.
Mr. Alvarez earned a B.S. in Business Economics from the University of California, Riverside, and an MBA with a focus in Finance from Loyola Marymount University, Los Angeles.
LATAM Weekly Summary
Key points from this week’s report:
Please refer to the attached PDF for the full report.
- Brazil’s Bovespa index gained 1.1% last week and made a new all-time high. It remains in a Confirmed Uptrend with four distribution days. We recommend clients add risk in Brazilian equities.
- Mexico’s main benchmark gained 0.1% last week and is trading just 2% off highs. The index remains in a Confirmed Uptrend with four distribution days. We recommend clients add risk in Mexican equities.
- Last week, we added Banorte (GTB.MX; GFNORTEO:MM) to the Focus List, taking the total number of Focus List stocks in the region to 11. Apart from Banorte, Fleury (FLE.BR; FLRY3:BZ) and Oncoclinicas (ODB.BR; ONCO3:BZ) are actionable.
- Stocks of interest: Multiplan (MUL.BR; MULT3:BZ), Raia Drogasil (DR3.BR; RADL3:BZ), Regional (GFR.MX; RA:MM) and Arca Continental (ARC.MX; AC*:MM).
O’Neil TMT Weekly
Software (IGV): The software benchmark pulled back 0.5% on low volume from its 52-week high. The IGV is testing
support at its rising 10-DMA ($405) with next level of support at its 21-DMA ($400). Quantitative metrics remains
constructive with its A/D Rating and Up/Down Volume ratio strong and steady at A and 1.4, respectively. RS line is
trending near 52-week highs with RS Rating at 88.
O’Neil TMT Weekly
Software (IGV): The software benchmark advanced ~1.5% on below average volume, closing at a fresh 52-week high. Immediate support is at its rising 10-DMA ($402). Quantitative metrics remain constructive with A/D Rating and Up/Down Volume ratio strong and steady at A and 1.6, respectively. RS line is trending near year-to-date highs with RS Rating at 89.
LATAM Weekly Summary
Key points from this week’s report:
Please refer to the attached PDF for the full report.
- Brazil’s Bovespa was up 2.4% last week and is slightly below all-time highs. It remains in a Confirmed Uptrend with three distribution days. We recommend clients add risk in Brazilian equities.
- Mexico’s main benchmark rallied 5.0% and hit a new all-time high last week. It remains in a Confirmed Uptrend with four distribution days. We recommend clients add risk in Mexican equities.
- We added Coca-Cola Femsa (KFBL.MX; KOFUBL:MM), Fleury (FLE.BR; FLRY3:BZ) and Oncoclinicas (ODB.BR; ONCO3:BZ) to the LATAM Focus List, taking the total number of Focus List stocks to nine. Apart from last week’s additions, Banco BTG Pactual (BPC.BR; BPAC11:BZ) is actionable.
- Stocks of interest: Ecorodovias (EON.BR; ECOR3:BZ), Cyrela (3CY.BR; CYRE3:BZ), Itausa (IS4.BR; ITSA4:BZ), Inter (IP9.BR; INBR32:BZ), Allos (SSB.BR; ALOS3:BZ), YDUQS (EST.BR; YDUQ3:BZ), Regional (GFR.MX; RA:MM), Banorte (GTB.MX; GFNORTEO:MM) and Banco de Chile (CLE.CL; CHILE:CI).
O’Neil TMT Weekly
Software (IGV): The software benchmark advanced ~2% on above average volume and is trading near a fresh 52-week high. The index is trending along support at its 10-DMA ($396). Quantitative metrics continue to remain constructive with its numerical A/D Rating and Up/Down Volume ratio rising and RS line hovering near its highs. Our Focus List stocks rose a median 3.4% this week, outperforming the IGV. Focus List ideas that are still buyable include MSFT, MDB, and GLOB.
LATAM Weekly Summary
Key points from this week’s report:
Please refer to the attached PDF for the full report.
- Brazil’s Bovespa declined 0.9% last week. The index remains in a Confirmed Uptrend. We recommend clients add risk in Brazilian equities.
- Mexico’s main benchmark index gained 0.9% last week and is just 2% off highs. It remains in a Confirmed Uptrend. We recommend clients add risk in Mexican equities.
- The number of Focus List ideas in the LATAM region remains at six. Banco BTG (BPC.BR, BPAC11: BZ) and Smartfit (SED.BR; SMFT3:BZ) are actionable.
- Stocks of interest: Banorte (GTB.MX; GFNORTEO:MM), Arca Continental (ARC.MX; AC*:MM), Fleury (FLE.BR; FLRY3:BZ), Cogna Educacao (KRO.BR; COGN3:BZ) and Oncoclinicas (ODB.BR; ONCO3:BZ).
O’Neil TMT Weekly
Software (IGV): The software benchmark pulled back ~1% last week and is consolidating sideways after strong gains (+4%) two
weeks ago. Support is at its 10-DMA ($389), followed by its rising 21-DMA ($380). Quantitative metrics remain strong, with an RS
Rating of 91, an A/D Rating of B+, and RS line at new highs. Six of the 11 software industry groups – Financial (#4), Database (#5),
Education/Media (#6), Security (#7), Desktop (#18), and Tech Svcs (#20) – are ranked among the top 20 in the O’Neil 197 IGs
LATAM Weekly Summary
Key points from this week’s report:
Please refer to the attached PDF for the full report.
- Brazil’s Bovespa was up 2.1% and hit a new multi-year high last week. It remains in a Confirmed Uptrend. We recommend clients add risk in Brazilian equities.
- Mexico’s main benchmark was up 1.8% and broke above resistance at the 200-DMA last week. It remains in a Confirmed Uptrend. We recommend clients add risk in Mexican equities.
- The total number of Focus List stocks in the LATAM region remains at six. Smartfit Escola (SED.BR; SMFT3:BZ) and Banco BTG (BPC.BR; BPAC11:BZ) are actionable.
- Stocks of interest: Cury Construtora (CCE.BR; CURY3:BZ), Vivara (VPO.BR; VIVA3:BZ), Equatorial (EQO.BR; EQTL3:BZ), EcoRodovias (EON.BR; ECOR3:BZ)), Porto Seguro (PSO.BR; PSSA3:BZ), Arca Continental (ARC.MX; AC*MM) and Coca-Cola Femsa (KFBL.MX; KOFUBL:MM).
O’Neil TMT Weekly
Software (IGV): The software benchmark rose 4.4% on rising volume, registering its fifth consecutive week of gains. The index is
extended from the pivot of its flat base and is trading 3.6% above its 10-DMA. Support is at $387, followed by the 10-DMA. Next
resistance is near $411. Quantitative metrics remain strong, with Up/Down Volume ratio comfortably above 1 and RS line in an
uptrend.
