Uber and Mosaic Are Showing Signs of a Reversal
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The earnings report from the largest U.S. memory chip manufacturer was met with heightened expectations after industry players became the biggest beneficiaries of the expansion of AI infrastructure. However, the results published after the market closed yesterday still exceeded expectations and were accompanied by a similarly strong forecast. In addition, management outlined a favorable long-term outlook, based on which it is not yet clear when the balance between supply and demand in the industry might be restored. In light of this, we continue to view the company’s fundamental outlook as strong and are maintaining it on our Equity Top Pick list.
Commodities - Technical Analysis
Gold and silver continued their correction, breaking through key support levels, which could push back the likelihood of a turnaround by several weeks. Oil’s correction is slowly approaching its first significant support level, so the market’s reaction to this zone will be crucial. The rapid rise in natural gas prices has already stalled, but the price remains above the uptrend line. Copper is likely to trade within a wider range, so oversold and overbought zones could present trading opportunities. Wheat and corn prices continued to move within a correction phase, so no new buy signals have emerged yet.
As momentum in the market’s leading sectors begins to moderate, high-quality laggards are increasingly moving into focus. In today’s technical analysis, we highlight two stocks that are showing encouraging signs following several months of accumulation: Uber, which is also included on our Equity Top Pick List and Mosaic, one of the world’s largest fertilizer producers. We examine the technical setup and key price levels for both stocks.
Best rated US stocks based on momentum ranking
Compelling technical picture:
Mosaic (daily): The stock has posted three consecutive days of strong gains. From a longer-term perspective, this is highly encouraging, although it has not yet broken above the 25 level. However, it has left upside gaps behind and appears to be preparing for a reversal following a prolonged accumulation phase. The chart is now suitable for buying on pullbacks. The minimum expected price target is around 31.25, though higher levels may become visible later on.
Uber (daily): After an extended period of sideways trading, the stock has shown several strong buying days followed by consolidation. The buying wave was not followed by concentrated selling pressure, which points to a potential trend reversal. The stock has not fallen back below 75 for a week, and that level has now turned into support, which is a positive sign and increases the likelihood of a sustained reversal. The minimum price target is 87.5, but the stock could also move toward the 94 area.
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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