US Markets Round-Up

This week, the Russell 3000 index, an important benchmark of the US stock market across all market capitalizations, started on a negative note and continued the momentum. The index made a low of 2419.54 during the week and settled at 2479.65 with a week-to-date (WTD) loss of 1.45 percent on March 10, 2022. Other major indices such as S&P 500 and NASDAQ Composite also showed downside movement for the week. On March 10, 2022, the S&P 500 index settled at 4259.52 with a WTD loss of ~1.60 percent, while NASDAQ Composite Index settled at 13129.962 with a WTD loss of ~1.38 percent.

The market remained in the negative territory amid the ongoing war between Russia and Ukraine. An increase in the US weekly initial jobless claims numbers to 227,000 from 216,000 (revised level) further acted as a catalyst for a downside direct. Notably, the Consumer Price Index (CPI) increased 0.8% in February 2022 on a seasonally adjusted basis. 

Tracking the US market performance over the week, taking cues from major global news flow, and based on our technical analysis of the Russell 3000 index, the two NYSE/ NASDAQ listed stocks show up strongly from the technical standpoint. Noted below are our recommendations based on generic insights, entry price, target prices, and stop-loss for Tronox Holdings PLC (NYSE: TROX) and Ferroglobe PLC (NASDAQ: GSM) for the next 2-4 weeks duration:

Tronox Holdings PLC 

Tronox Holdings PLC (NYSE: TROX) is a specialty chemical company that produces titanium products. The Company operates titanium-bearing mineral sand mines in Australia, South Africa, and Brazil. Noted below are the key price indicators for the stock:

Price Action Analysis (on the Weekly Chart) 

TROX has recently tested a crucial support level of USD 17.00 and inched up from there, indicating the possibility of an upside reversal from hereon. The recent upside movement in the stock is backed by increasing volumes as well, further supporting a positive bias. The next major resistance level for the stock appears at USD 22.00 and there is a high probability that the prices may test this level in the short-term (2-4 weeks).

Technical Indicators Analysis (On the Weekly Chart)

On the weekly chart, RSI (14-period) is recovering from the lower levels and trading at 35.95 levels, indicating the stock is recovering from the lows and can show strength further as the RSI heads towards the North. However, the trend-following indicators 21-period SMA and 50-period SMA are above the CMP and may act as the resistance levels.

Financial Summary

Summary of the Key Financial Metrics for the past four years for Tronox Holdings PLC is as follows:

General Recommendation

As per the above-mentioned price action and technical analysis, we can conclude that Tronox Holdings PLC is technically well-placed on the chart, and hence we gave a ‘Speculative Buy’ rating on the stock. Investment decisions should be made depending on an investors’ 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 our recommendation is as follows:

Ferroglobe PLC

Ferroglobe PLC (NASDAQ: GSM) is a producer of silicon-based alloys, silicon metal, and manganese-based alloys. Noted below are the key price Indicators for the stock: 

Price Action Analysis (on the Daily Chart)

GSM has shown a recent breakout, crossing the downward slopping trend line and currently, prices are forming strong consolidation at current levels. This behaviour normally is a pre-indication of a positive trend formation on the charts. The next major resistance level for the stock appears at USD 10.20 and prices may test this level in the short-term (2-4 weeks). A further movement above USD 10.20 may extend buying in the stock.   

Technical Indicators Analysis (On the Daily Chart)

On the daily chart, RSI (14-period) is showing a reading of 63.98 levels, indicating a positive trend for the stock. The volumes also seem supportive of the upside movement. Prices are trading above the trend-following indicator 50-period SMA, further supporting an up-move; however, 21-period SMA is above the CMP and may act as the resistance levels.

Financial Summary 

Summary of the Key Financial Metrics for the past four years for Ferroglobe PLC is as follows: 

General Recommendation

As per the above-mentioned price action and technical indicators analysis, we can conclude Ferroglobe PLC is looking technically well-placed on the chart, and we gave a ‘Speculative Buy’ rating on the stock. Investment decisions should be made depending on an investors’ 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 our recommendation is as follows: