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 negative note; however, it gained bullish momentum later. The index made a high of 2322.243 during the week and settled at 2321.408 with a week-to-date (WTD) gain of ~2.19 percent on September 08, 2022. Other major indices such as S&P 500 and NASDAQ Composite also witnessed positive momentum for the week. On September 08, 2022, the S&P 500 index settled at 4006.180 with a WTD gain of ~2.09 percent, while the NASDAQ Composite Index settled at 11862.129 with a WTD gain of ~1.99 percent.

The improved ISM Services PMI data released during the week supported the market sentiments. Moreover, the US Unemployment Insurance Weekly Claims numbers decreased to 222,000 from 228,000 (revised level) in the prior week, which further supported the indices.

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 two NYSE/NASDAQ listed stocks to pick from the technical standpoint. Noted below recommendations are based on the entry price, target prices, and stop-loss for Lithium Americas Corp. (NYSE: LAC) and Riot Blockchain Inc. (NASDAQ: RIOT) for the next 2-4 weeks duration: 

Lithium Americas Corp. 

Lithium Americas Corp. (NYSE: LAC), formerly Western Lithium USA Corp., is a resource company that explores lithium deposits. Noted below are the key price indicators for the stock:

Price Action Analysis (on the Weekly Chart)

LAC's prices started to move upside after taking support at the resistance turned support level of USD 28.00, indicating the possibility of further upside movement. Now the next major resistance level for the stock appears at USD 36.50, and prices may test this level in the short-term (2-4 weeks). A further movement above USD 36.50 backed by volumes 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 57.76. The volumes seem supportive for the next upside movement. The prices are trading above the trend-following indicators 21-period SMA and 50-period SMA, which may support the prices.

General Recommendation

As per the above-mentioned price action and technical indicators analysis, Lithium Americas Corp. 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. 

Riot Blockchain, Inc. 

Riot Blockchain Inc. (NASDAQ: RIOT) specializes in cryptocurrency mining with a focus on bitcoin. Noted below are the key price indicators for the stock:

Price Action Analysis (on the Daily Chart)

RIOT's price took the support from a horizontal line and recently broke a falling trendline by an upside, indicating the possibility of further upside movement. The recent upside movement in the stock is backed by increasing volumes as well, further supporting a positive bias. Now the next major resistance level for the stock appears at USD 8.70 and prices may test this level in the short-term (2-4 weeks). A further movement above USD 8.70 may extend buying in the stock.

Technical Indicators Analysis (On the Daily Chart)

On the daily chart, the leading indicator RSI (14-period) is above the midpoint and showing a reading of 52.04, indicating the upside rebound hereon. The volumes seem supportive for the next upside movement. The prices are trading above the trend-following indicator 50-period SMA, which supports the prices in the near term; however, the 21-period SMA is moving above the CMP and may act as a resistance level.

General Recommendation

As per the above-mentioned price action and technical indicators analysis, Riot Blockchain, Inc. 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.

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