Twenty-three developed markets gained 0.9% on average and 19 are in a Confirmed Uptrend, the 34th week with a majority. Twenty-three emerging markets gained 0.3% on average and 16 markets are in a Confirmed Uptrend, the 15th week with a majority
Tag: Confirmed Uptrend
US Focus Long
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
European Focus Long
Q1 ended on a very strong note with the European markets advancing 1.3% on average for the final week. Every market rose
except for Norway (-0.7%) and the U.K. (-0.2%), and Austria was flat. Portugal was the standout performer for the week,
gaining 6.8% as it saw a follow-through day and was moved into a Confirmed Uptrend. France (+2%) and Germany (+2.1) also
gained more than 2%. The strength of the markets is impressive and, combined with the major countries performing well, this rally looks to have legs to run further.
As Markets Pause, an End to Long Bullish Streaks in the U.S.
Twenty-three developed markets lost 0.5% on average and 19 are in a Confirmed Uptrend, the 33rd week with a majority. Twenty-three emerging markets lost 0.1% on average and 16 markets are in a Confirmed Uptrend, the 14th week with a majority.
US Focus Long
The U.S. market was downgraded to Uptrend Under Pressure on Tuesday due to a heavy volume downside reversal that closed below the 21-DMA. Despite the downgrade, leadership outside of Banks has acted well, with multiple ideas bouncing back into new highs. We will be looking for the major averages to avoid further distribution, settle above support levels, and for Banks to move back above their respective 50-DMAs in the coming days. This will likely result in the market being moved back into a Confirmed Uptrend.
European Focus Long
Uncertainty regarding U.S. policies sent European markets lower for the first time in four weeks. On average, markets were down 0.6% as only three – Portugal (+1.4%), Spain (+0.7%), and Italy (+0.4) – closed higher. However, the key markets of France and Germany declined only slightly, falling 0.2% each. The U.K. fared slightly worse, losing 1.2%. Distribution days accumulated throughout the week, raising the average to 3.9 for the countries in a Confirmed Uptrend. Denmark was shifted to a Downtrend from Under Pressure during the week.
Market View
The market remains in a Confirmed Uptrend, avoiding distribution throughout the week. The S&P 500 and Nasdaq continue to trade off short-term support along the 21-DMA and are now testing prior highs. Leading ideas continue to act well, with many moving higher off areas of support. Our positive stance on the general market will remain until we see a change of character in the major averages and leadership ideas.
Stocks on our U.S. Focus List: Current Sentiment
Our USFL of 50 names (including two new additions) gained 1.6% on average this week, outperforming the S&P 500 (0.2%) and the Nasdaq (0.7%).
By Sector
Technology ideas within the USFL outperformed all other sectors, led by ADBE’s earnings gap up Friday. RP and COHR, up 50+% and 80+% since their additions to the list last year, each rallied over 5% this week. COHR found support off its 21-DMA and looks poised to breakout again. VEEV and RNG also acted well, each breaking into new highs. IPHI, which has been lagging for several weeks, found support off its 200-DMA, bouncing in very heavy volume. Conversely, Financials, specifically Banks, lagged the general market. All USFL Bank ideas (MS, KEY, FRC, WAL, CFG) have pulled back into their respective bases. We do expect each of them to find support around current levels as they have done over the past two months.
US Focus Long
The market remains in a Confirmed Uptrend, avoiding distribution throughout the week. The S&P 500 and Nasdaq continue to trade off short-term support along the 21-DMA and are now testing prior highs. Leading ideas continue to act well, with many moving higher off areas of support. Our positive stance on the general market will remain until we see a change of character in the major averages and leadership ideas.
European Focus Long
Positive results from the Dutch elections and European central banks maintaining their status quo helped extend gains for a third consecutive week, with indices advancing 0.9% on average. Portugal (-0.3%) and Sweden (-0.2%) were the only markets to close lower, while six markets, including Italy (+2.2%), Spain (+2.1%), Germany (+1%), and the U.K. (+1%), gained more than 1%. Italy was moved into a Confirmed Uptrend from Under Pressure and Portugal was changed to a Downtrend from Under Pressure.
Market View
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.
