We see potential in a cybersecurity company
Related content
Our Equity Top Pick List
We have updated our Equity Top Pick List to reflect the events of the past quarter. The list includes those stocks, typically US and European ones, that we consider to be proper investment choices from a fundamental point of view. It can provide a starting point for building a sector-diversified equity exposure in portfolios, but can also be used as a watch list. Technical analysis should be used to time / determine the specific investment decision.
Could the momentum return in the semiconductors?
The semiconductor sector has had a challenging quarter, with its performance in recent months lagging behind improvements in underlying fundamentals, even as AI-driven demand remained exceptionally strong. The accelerating adoption of AI by enterprises and the proliferation of AI agents are significantly increasing the demand for computing capacity, which points to a further surge in cloud services and data center investments. Given current supply constraints, record-high backlogs, and higher-than-expected investment needs, we expect further upward revisions to earnings forecasts in the semiconductor industry. Nevertheless, the sector’s valuation appears favorable from a historical perspective, which, in our view, could result in a more attractive risk-return profile in the coming months.
U.S. stock markets have just experienced a significant rally, and signs of momentum exhaustion have already emerged—meaning the upward momentum may be losing steam—but many stocks are only now beginning to join the rally. Energy and technology stocks continue to perform well. This week, we took a closer look at the stocks of Skyworks Solutions, a semiconductor manufacturer, and Palo Alto, a world-leading cybersecurity technology company.
Best rated US stocks based on momentum ranking
Compelling technical picture:
Skyworks Solutions (daily): Over the longer term, the share price recently hit a higher low above the 50 level. The recent uptrend signals a structural shift from the last downtrend, which is a positive sign and could pave the way for another long-term rally. The stock may face stronger resistance in the 81.25–87.5 range.
Palo Alto Networks (daily): The downward trend structure—marked by a series of lower highs and lower lows—had already shifted several weeks ago. The recent upturn is encouraging and may signal the start of a sustained upward trend. The thick green trendline represents the risk management level. Based on the reversal pattern, the area around the previous breakout level (206.25) may also be reached.
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.
Get more out of your investments!
Global Markets Services
OTP Global Markets offers a broad range of services in the field of local and international money and capital markets.
Read morePrivate Banking Services
Personal care and expertise with OTP Private Banking, along with the knowledge, security, and innovations of a multinational banking group.
Read more