We see opportunities in the industrial and financial sectors
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Commodities - Technical Analysis
Both gold and silver are in a short-term downtrend. It is still worth waiting for buying opportunities in these markets. Oil is becoming increasingly range-bound, which could set the stage for a significant move soon. Natural gas prices have been on an upward trajectory since breaking out of their downtrend. Copper has reached the projected level, from which a downward correction has begun. Wheat and corn are in a correction phase within their upward trends.
FX - Technical Analysis
The dollar’s trend reversed at the beginning of last week and started to strengthen. It has already reached the first target level; the natural level at 1.1597 should act as support, otherwise we may see further dollar strength. The Hungarian forint is undergoing some correction against both the euro and the dollar, but this is still not sufficient for a structural shift in the downside pattern, and reversals in the curve still need time to develop. In the case of the USD/JPY pair, there may be a chance for a reversal below the 159.38 resistance, but this would require a strong downward move within the next few days. In EUR/CHF, a higher low may form, which could indicate a turn to the upside.
The companies identified—based on our screening criteria—as having upward potential primarily come from the financial, industrial, and technology sectors. Overall, however, the market environment remains highly volatile. Currently, it is more likely that stock markets will move within a broader, sideways range, with the possibility of reaching new highs. In this situation, a momentum-based approach may offer more favorable trading opportunities: selling at overbought levels and buying in oversold ranges may be advisable.
Best rated US stocks based on momentum ranking
Compelling technical picture:
AMD (daily): The longer-term chart looks promising, as the stock bounced off the key natural support level of $187.50 two weeks ago, leaving a gap open. In recent days, it broke through the upward correction within the uptrend, signaling a long position. The upside is now more open; the previous high of $265 could be easily reached, but it could go even higher.
Morgan Stanley (daily): The stock has broken out of its corrective downtrend in recent days, opening the door to an uptrend. It has also left a gap behind, which is a very good sign and suggests there may still be room for further gains. The 175 level could offer a good entry point for a long position, while the target price could be around 200 at a minimum. We could see it go even higher, so the potential return relative to the risks makes this long opportunity look even more attractive. The bank will release its quarterly report on Wednesday, which could cause a significant shift in the price.
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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