My Weekly Stock Debrief - Mar 18-25
Dear subscribers,
Welcome to My Weekly Stock’s debrief for week #12 of 2022 (Mar 18-25th),
Our free weekly newsletter reviews the market performance this week in 10 points:
Marker Performance
SP500 Sector Performance
SP500 Top / Bottom Stock Performers
SP500 Breadth
SP500 Daily Chart
Market Sentiment
Our Chart of the Week
Our Favorite Analysis of the Week
The Week Ahead
My Weekly Stock’s pick
1. Market Performance
The Equity markets have risen for a second consecutive week, with the SP500 finishing with a 1.8% gain. Interestingly, it was an “all-up” week as Gold, Oil, yield, and Bitcoin closed the week positive. Oil prices climbed back above the $110 mark, and consequently, the energy sector delivered another stellar weekly performance.
Year-to-date, all major equity indexes remain down despite the rally since mid-march, while Oil and Gold show positive returns.
2. SP500 Sector Performance
We saw another broad-based rally in the SP500, with almost all sectors posting a positive week. Energy led the market, but contrary to the previous weeks, it did not prevent other sectors from participating in the rally.
Financials and Utilities now join the energy sector as the only positive sectors in 2022. Communication Services and Consumer Cyclical remain slightly in correction territory.
3. SP500 Top / Bottom Stock Performers
The energy and material stocks reclaimed their leadership in the weekly leaderboard. This week's worst performers are all cyclical stocks, in perfect contrast to the previous week.
As expected, the best performers in 2022 remain energy stocks. The worst performers are mostly growth/technology stocks, with Paypal (PYPL) and Netflix (NFLX) down almost 40% in 2022. EPAM lost 60% of its value as the software company has large software development sites in Ukraine, Russia, and Belarus.
4. SP500 Breadth
The breadth and momentum continued to improve and be constructive in the short term. We now have 61% of the SP500 stocks trading above their 50-day moving average, and many stocks, like Tesla, Microsoft, Apple, and Alphabet, broke out from this level this week. If these stocks lead the market as they did in the last 2-3 years, we could see new highs sooner than we think.
Read more about market breadth
5. SP500 Daily Chart
The SP500 reclaimed its 50 and 200-day moving averages, which is a good confirmation. RSI and MACD are both on a rising trend and could run slightly higher before being overheated.
6. Market Sentiment
Fear & Greed Index
CNN's Fear & Greed Index tracks seven investor sentiment indicators and is published daily.
Read more about the Fear & Greed Index
On Friday, the indicator closed at the “Neutral” level (46), significantly improving after hitting a 2022 low just two weeks ago. The VIX is still decreasing and approaching a value of 20, a level not seen since the start of the conflict in Ukraine.
AAII Investor Sentiment Survey
The American Association of Individual Investors surveys each week its members on the direction of the stock market for the next six months. The results are published weekly on Wednesdays.
Read more about the AAII sentiment survey
The last AAII survey reported on March 16th that 35% of the respondents had a bearish outlook for the markets, a drop of 15 points, vs. the previous week. While the bullish sentiment is below the average of 38% for the 18th consecutive week, we expect market sentiment to normalize soon.
7. Our Chart of the Week
While we are left with only four trading days in March, April is around the corner and is historically the best month of the year. Since 1980, April has brought investors an average performance of +2.0% and positive returns 75% of the time.
8. Our Favorite Analysis of the Week
Volatility index cooling down
The VIX finally broke below 30 after two weeks above this level. According to Ryan Detrick, the end of previous similar streaks all brought solid returns.
Is Smart money buying the dip?
The chart from SentimentTrader illustrates that smart money has been buying the dip after holding a sizeable short position since January.
The market breadth and momentum
In this video, Ed Clissold, chief U.S. strategist at Ned Davis Research, reviews how the breadth and momentum indicators point out more gains for the stock indexes.
9. The Week Ahead
Few earnings reports next week as this earning season is approaching its end. The main reports will be Micron, Walgreens, and Lululemon.
The week will also be heavy on the economic data front with the March jobs report and personal consumption expenditures (PCE) data. Both reports may influence the FED's future actions, especially after the FED chairman hinted at more hawkish actions if required.
Beyond earnings and economic reports, the investors will monitor the performance of oil and interest rates after their substantial increase last week. At the same time, news from Ukraine might bring back some volatility short term.
10. My Weekly Stock Pick
Our stock pick was TRV, and it finished the week up 3.5% (Monday open to Friday close). In 2022, My Weekly Stock’s picks are up 35% (no leverage, buy and hold five days), and our options trading is up 200%.
Access our performance tracking here.
We will trade a stock in the financial sector for the coming week. You can learn more about our trading approach in the article below:
Read more about our trading approach here.
Join us to unlock My Weekly Stock’s pick, access our trading plan, and receive timely buy/sell alerts. We currently have a 14-day free trial!
That’s all for My Weekly Stock’s debrief for week #12 of 2022 (Mar. 18-25th).
If you enjoy reading our newsletter, you can share it via the link below:
You can also follow us on Twitter where we post many more charts during the week.
Finally, if you have any feedback or question about the newsletter, you can reply directly to this email.
Have a lovely trading week,
My Weekly Stock
Disclaimer
My Weekly Stock shares information and content on our websites, social networks, or newsletters only for educational purposes. The information contained in our publications has been prepared based on publicly available information and proprietary research. The author does not guarantee the correctness, accuracy, or completeness of the information provided.
All information provided by My Weekly Stock or its affiliates is impersonal and not tailored to your needs, your investment objectives, or your financial situation. Nothing contained in the report shall constitute financial advice or an investment recommendation.
You are solely responsible for your own investment decisions. We recommend consulting with a registered investment advisor, broker-dealer, or financial advisor. If you choose to invest, with or without seeking advice, then any consequences resulting from your investments are your sole responsibility. We are neither liable nor responsible for any profits or losses arising from any investment decision you have taken or made based on information we provide on our websites, social networks, or newsletters.
By using this site, newsletter, or any information provided herein, you indicate your consent and agreement to the terms of this disclaimer.