US Markets Round-Up

This week, the Russell 3000 index, an important benchmark of the US stock market across market capitalizations, started on a positive note but could not maintain the momentum. The index made a low of 2259.067 during the week and settled at 2266.465 with a week-to-date (WTD) loss of ~3.94 percent on September 15, 2022. Other major indices such as S&P 500 and NASDAQ Composite witnessed a bearish movement for the week. On September 15, 2022, the S&P 500 index settled at 3901.35 with a WTD loss of ~4.08 percent, while the NASDAQ Composite Index settled at 11552.357 with a WTD loss of ~4.62 percent.

Major indices plunged after the release of higher-than-expected inflation numbers. Notably, the US Unemployment Insurance Weekly Claims numbers decreased to 213,000 from 218,000 (revised level) in the prior week.

Having understood the US market performance over the week, taking cues from major global news, and based on technical analysis of the Russell 3000 index for the upcoming week, now let’s have a look at the one NYSE listed stock to pick from the technical standpoint. Noted below recommendation is based on the entry price, target prices, and stop-loss for Planet Labs PBC (NYSE: PL) for the next 2-4 weeks duration: 

Planet Labs PBC

Planet Labs PBC (NYSE: PL) provides global, daily satellite imagery and geospatial solutions through online platforms worldwide. Noted below are the key price indicators for the stock:

Price Action Analysis (on the Weekly Chart)

PL’s prices broke a double bottom (bullish reversal) pattern by an upside and are sustaining above the breakout level, indicating the possibility of upside momentum hereon. The pattern breakout is supported by a sharp increase in the volumes, further supporting a positive bias. Now the next major resistance level for the stock appears at USD 8.50, and prices may test this level in the short-term (2-4 weeks). A further movement above USD 8.50 may extend buying in the stock.

Technical Indicators Analysis (On the Weekly Chart)

On the weekly chart, the leading indicator RSI (14-period) is moving in a positive zone and showing a reading of 61.01. The volumes seem supportive of the next upside movement. The prices are trading above the trend-following indicators 21-period and 50-period SMA, which may support the prices.

General Recommendation

As per the above-mentioned price action and technical indicators analysis, Planet Labs PBC is looking technically well-placed on the chart, and a ‘Speculative Buy’ recommendation has been given on the stock. Investment decision should be made depending on an individual’s appetite for upside potential, risks, and any previous holdings. This recommendation is purely based on technical analysis, and fundamental analysis has not been considered in this report. The summary of recommendation is as follows:

Markets are trading in a highly volatile zone currently due to certain macro-economic and prevailing geopolitical tensions. Therefore, it is prudent to follow a cautious approach while investing.

Upcoming Major Global Economic Events

Market events occur on a day-to-day basis depending on the frequency of the data and generally include an update on employment, inflation, GDP, consumer sentiments, etc. Noted below are the upcoming week's major global economic events that could impact the Russell 3000 Index and stocks’ prices:

Related Risks: This report may be looked at from high-risk perspective and recommendations are provided are for a short duration. Recommendations provided in this report are solely based on technical parameters, and the fundamental performance of the stocks has not been considered in the decision-making process. Other factors which could impact the stock prices include market risks, regulatory risks, interest rates risks, currency risks, social and political instability risks etc.

Note 1: Individuals can consider exiting from the stock if the Target Price or Stop loss mentioned as per the technical analysis has been achieved and subject to the factors discussed above.

Note 2: How to Read the Charts?