US Markets Round-Up

This week, the Russell 3000 index, an important benchmark of the US stock market across market capitalizations, started on a marginally positive note and maintained the momentum. The index again made a new lifetime high of 2583.77 on July 01, 2021 and closed at 2583.20 with a week till date (WTD) gain of ~0.67 percent. Other major indices such as S&P 500 and NASDAQ Composite also showed positive movement during the week. On July 01, 2021, the S&P 500 index settled at 4319.94 with a WTD gain of ~0.52 percent, while NASDAQ Composite Index settled at 14522.38 with a WTD gain of ~0.13 percent.

A decent downfall in the US weekly unemployment claims helped the indices to retain at higher levels. As per the data released by the US Bureau of Labor Statistics, US weekly unemployment claims further decreased to 364,000 from 415,000 (revised level) in the prior week and registered the lowest level since March 14, 2020. Other economic data released during the week such as CB Consumer Confidence, Pending Home Sales, and ADP Non-Farm Employment Change also supported the positive direction.

Having understood the US market performance over the week, taking cues from major global news, and based on our technical analysis of the Russell 3000 index for the upcoming week, now let us have a look at the two NYSE/ NASDAQ listed stock picks from the technical standpoint. Noted below are our recommendations based on generic insights, entry price, target prices, and stop-loss for Transocean Limited (NYSE: RIG) and SQZ Biotechnologies Co (NYSE: SQZ) for the next 2-4 weeks duration:

Transocean Limited 

Transocean Ltd. (NYSE: RIG) is an offshore drilling contractor headquartered in Switzerland. The company has business operations in the US, Norway, India, Brazil, Canada, etc. Noted below are the key price indicators for the stock:

Price Action Analysis (on the Weekly Chart) 

RIG's price broke a major resistance level of USD 4.81 on the upside on June 29, 2021 and has since then been hovering around the breakout level, indicating an upside direction for the stock. Prices are also trading above the downward sloping trend line, further supporting a positive stance. Now the next major resistance level appears at USD 5.91, and prices may test this level in the short-term (2-4 weeks). A further breakout above USD 5.91 backed by volumes may extend buying in the stock.

Technical Indicators Analysis (On the Weekly Chart)

On the weekly chart, RSI is trading at ~65.75 levels and indicating a positive trend for the stock. The weekly volumes are showing an increasing trend and seems supportive of an upside movement. The CMP is above the 21-period and 50-period SMA with a positive crossover, further providing support for the upward direction.

Financial Summary:

Summary of the Key Financial Metrics for the past four years for Transocean Limited is as follows:

General Recommendation:

As per the above-mentioned price action and technical indicators analysis, we can conclude that Transocean Limited is looking technically well-placed on the chart, and we have a ‘Buy’ rating on the stock. Investment decision should be made depending on an investors’ appetite on 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:

SQZ Biotechnologies Co

SQZ Biotechnologies Co (NYSE: SQZ) is a clinical-stage biotechnology company. It is engaged in developing transformative cell therapies for cancer patients, infectious diseases, and other serious conditions. Noted below are the key price Indicators for the stock:

Price Action Analysis (on the Daily Chart)

SQZ's price broke a major resistance level of USD 14.71 on the upside on July 01, 2021 and is indicating an upward direction for the stock. Prices have witnessed the breakout of the resistance level after a long consolidation phase, further supporting a positive stance. Now the next major resistance level appears at USD 18.00, and prices may test this level in the short-term (2-4 weeks). 

Technical Indicators Analysis (On the Daily Chart)

On the daily chart, RSI is trading at ~64.72 levels and indicating a positive trend for the stock. The daily volumes are showing an increasing trend and seems supportive of an upside movement. The CMP is above the 21-period and 50-period SMA with a positive crossover, further providing support for the upward direction.

Financial Summary: 

Summary of the Key Financial Metrics for the past three years for SQZ Biotechnologies Co is as follows: 

General Recommendation:

As per the above-mentioned price action and technical indicators analysis, we can conclude that SQZ Biotechnologies Co is looking technically well-placed on the chart, and we have a ‘Speculative Buy’ rating on the stock. Investment decision 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: