Markets are in decline, with no stocks showing signs of a turnaround
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Micron's blowout results could give the AI story a new boost
Micron Technology, the largest memory chip manufacturer in the United States, has achieved results that are outstanding even by historical standards. The company far exceeded expectations in every respect and also delivered a significant positive surprise in terms of its forecasts. In addition, it announced 16 new long-term strategic agreements that lock up a significant portion of its manufacturing capacity for years to come. These agreements significantly improve the longer-term revenue outlook, which previously represented the greatest risk for players in the traditionally highly cyclical memory market. We continue to view the fundamental outlook for this stock—which is also included on our Equity Top Pick list—as strong, and are therefore raising our fair value estimate from $550 to $1,635.
The model seeks to identify stocks that are showing signs of a turnaround following a downtrend, while also ranking among the top performers within the S&P 500 based on relative strength. However, the U.S. stock market has been sending uniform sell signals for two weeks, and since then, it has persistently maintained downward trends following reversal patterns. Numerous one-year uptrends have broken down, so it is not surprising that the model has not found any stocks that are poised for a reversal at this time. All of this clearly indicates that the markets are characterized by widespread selling pressure. The only difference may be that certain sectors could outperform in relative terms, meaning they fall less than the market as a whole.
Best rated US stocks based on momentum ranking
No stocks met the screening criteria this week.
List of stocks with a chance of a turnaround in the coming weeks
Most popular US stocks
The momentum model supports the creation of a technical based stock list that helps to find shorter-term trading opportunities. The model can be used to identify stocks that show reversal signals following more sustained falls/underperformance. We examine one-year, six-month, three-month, one-month and five-day momentum values, which are used to rank the stocks under consideration. The higher a stock is ranked in the order, the better it technically performs relative to the others. The change in the ranking over time is used to determine the life cycle of the stock.
- In the first table, we collect the stocks that show the most attractive picture compared to the others in a given week based on momentum factors, of which those are also presented in a separate chart where a favourable situation can be identified based on additional technical analysis tools.
- In the second table, we list the stocks that are already worthy of being placed in watchlist status. They are not among the best performers, but they have the potential to improve and signal a turnaround in a few days or weeks.
- In the third table, we have also collected the more popular stocks to help identify their position in the momentum order.
The report shows the results of a technical - quantitative based stock screening, which does not examine the fundamental background/value of the companies. For this reason, risk management/position sizing rules should be designed accordingly.
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