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The Hot Stocks Outlook uses VantagePoint’s market forecasts that are up to 87.4% accurate, demonstrating how traders can improve their timing and direction. In this week’s video, VantagePoint Software reviews forecasts for Franco-Nevada ($FNV), Schlumberger ($SLB), Holly Frontier ($HFC), Reliance Steel and Aluminum ($RS), Steel Dynamics ($STLD) and Waste Management ($WM)
Hello again traders and welcome back to the Hot Stocks Outlook for March 3rd, 2022. Hope y’all are having a excellent week out there in the financial markets and as always, plenty to cover here in today’s outlook. We’re going to start out with shares of Franco-Nevada and we’ve looked at this a few times over the past few weeks. So it’ll be a really great example to really highlight each of the tools here found within VantagePoint, but we’ll also revisit Schlumberger and HollyFrontier. So a little bit on the energy within the basic material side of things. We’ll also look at some steel stocks and again, we’re seeing a lot going on within this basic material space and a little bit going on in the traditional areas of the market where VantagePoint is picking up on some things. We’ll look at waste management, but these first five stocks we’ve looked at quite a bit over the past several weeks and all very much in the basic material, oil, gas, metal sort of realm of things. But let’s go ahead and start this out.
So starting with Franco-Nevada here, and what we have here is daily price action, right? So each one of those candles is representing a full and complete trading day and right up against all that price data, you’ll notice that there is a black line and also a blue line there. So the black line that you’re seeing there, that is a regular simple moving average. In this case, it’s a 10 day simple moving average. So it’ll just look back at the previous 10 day closes, add them all together, and then divide by 10. And so what that does is it smooths out the existing price action and lets the trader know where the market has been. But obviously, the trader needs to know where’s the market going next, not where it’s already been. And so what we’re able to do is compare that lagging moving average of where things have already been to this prietary predicted moving average generated via the technology found within VantagePoint.
So for this value, so this is essentially prediction of average prices for that to be generated via the technology. This is where VantagePoint is utilizing its technology of artificial neural networks to do what’s called intermarket analysis. And in a market like this, we can see why that is extremely important because things are being driven by oil prices, gold prices, the value of the dollar, interest rates. And those are the types of big macro markets that are going in to especially a calculation like Franco-Nevada’s. What’s going on in gold and copper markets, right? What’s going on in the dollar index? But it’s also able to look at what’s going on in ETF relationships and also relationships between individual stocks, whether they be positively correlated or inversely correlated, and also things just like the broader stock market, like the S&P 500, the Nasdaq. And so it’s able to take all of this into account, understand specifically how it’s affecting the target market that you’re trying to trade.
And it actually generates future price predictions based off of that intermarket approach. So it’s taking this technology, looking at those relationships, and using that valuable information to make a true price prediction of where things are going next. And it’s those predictions generated via the technology that are then worked into the value of these indicators, turning what was a lagging tool that’s always going to be dragged behind the market and what’s already occurred into a forward-looking predictive tool. So we look at this week to week, whenever we see this blue line cross above the black line, suggesting average prices are going to start moving higher and therefore your behavior should probably be looking to get long by call option, something of that effect and executing that strategy. So you see there’s been about a 14% rally in the past 20 days in shares of Franco-Nevada but there’s more to the forecast than just the blue line and the black line.
If you look at the bottom of the chart, you’ll see you have a bar that goes from green to red, back to green. And this is what’s called the predicted neural index, extremely accurate indicator, but it’s only predicting very short-term two days ahead, 48 hours short-term strength or weakness in the market. So what we can do is really combine these tools to produce an overall forecast. What is the overall trend direction? Is there a possibility for short-term strength or weakness over the next 48 hours? So I can be prepared for that. And lastly, you’re actually provided a predicted range. So if you look at the very right-hand side of the chart, you have a shadow candle, and what that is a predicted high and a predicted low for the next trading day you see provided before that next trading day is going to occur.
And so every week what we do is we come in here and we look at how accurate all of those VantagePoint predictions have been against the actual market data. But again, Franco-Nevada this is something that for weeks we identified, Hey, not only is something going on in the basic material space, but specifically when it comes to this market, this is where these neural networks are going to come in and let you know, Hey, the market closed here on this trading day, we’ll look at your predicted trading range slanting lower and saying, look, expect prices to potentially move lower here but the overall trend is still up. You only want to go long, take profits on longs. You see, you get a lot of volatility here, again, VantagePoint’s saying, Hey, if you want to be a buyer down at these predicted lows, nice place to be, you see we get a nice rally there. Again, close after this day, letting you know, look for some weaker prices.
You’re getting these adjustments every single day because what VantagePoint’s able to do is take in the close, look at all those global market relationships, understand how they’re affecting the markets that you’re involved in, and then provide you an accurate forecast as to where things are likely to move next. So there’s Franco-Nevada, we talked a lot about oil and energy prices.
And so we’ve seen the commodity oil stay in a very strong uptrend and that was offering a lot of support on why you might look towards some of these energy stocks like Schlumberger. And you see we’ve got about a 37% rally over this period of time, but we were coming in and saying, look, Schlumberger looks very bullish as far as looking for opportunities to get long in a market where there’s not easy places to take long positions. Well, this has been an excellent opportunity, not only to catch this rally, but you see, as these prices come in, getting consistent levels here to manage this position effectively.
But when the market shifts, you have to recognize that. And in an environment where it seems like energy stocks and oil are going to keep moving up, something shifted here and a trader needs to understand that and accommodate for that. And what VantagePoint is saying here is its tools are looking out and there’s been enough here that says, look, there’s been a shift here. Just because oil prices are busting over a hundred dollars a barrel doesn’t mean that some of these stocks have to, and there’s important market relationships like interest rates, like other stocks, ETFs that play into this and are going to affect your trading decisions here. So just in the past couple of weeks, Schlumberger was a great move higher, but we’ve seen these problems really start to emerge in an area where again it’s getting choppy there, but you only want a short, take profits on shorts would be what to do.
Here’s HollyFrontier, and so this being another energy stock, you see this coming through on the 17th, letting you know that there’s some weakness here. If you’re playing that exposure to energy through energy shares, there’s a problem with this. And you see that you come to this predicted high, the bottom really dropping out here and you see things settling a little bit here, but making it very clear that there are some issues with the energy stocks. And what you can do is just divert that capital. Maybe just push it into the commodity as a more direct bet or into some of these other stocks where all these conditions look favorable. So steel and just basic material metal mining companies generally.
Reliance Steel and Aluminum ($RS)
Well, here’s Reliance Steel & Aluminum you see crossover to the upside through this entire month, very strong forecast here. And we can again, look at the predicted highs and lows that say, okay, well, if you’re in this market, what are the levels that you’re actually looking to day-to-day to help guide you?
And you see here, well, if you actually have limit orders waiting on these things, you just get filled, and then the market starts to move higher. So where this comes in is allowing you to recognize, one, if you’re a very short-term trader, what areas even make sense to focus your longs or your shorts. And more importantly, if you’re in a market when to stay involved in that market, because this is at 156, we’re pushing up against 200 already.
Here’s Steel Dynamics, very similar picture with a lot of strength as far as that blue line over the black line crossover, you see you get this period here, we get some sideways action. Some lower lows is typically what you want to look for over the subsequent 48 hours of price action. But the blue line remains above the black line.
The overall trend is still up and it’s a situation that just says, look, you want to be a long, take profits on longs, look towards the other steel and the mining companies. And there’s some really nice opportunities here on the long side. So 32% rally there in just the past few weeks of trading.
And I just wanted to bring through waste management here, because it’s a lot more recent as far as what’s occurred, but there’s been another potential shift in the market, but you want to be really careful on where you would want to get that bullish exposure. We saw a lot of stocks turn, but some look a lot stronger than others here. So you see waste management was in a very strong downtrend and it became very clear that, okay, well, all you’re doing is short, take profits on shorts. And if you’re looking to try to get long waste management or you’re simply waiting on your tools to reverse and go ahead and get bullish.
And we had a lot of stocks on… This was a Thursday here, really do extremely well. VantagePoint did exactly what it needs to, it clued in and said, Hey, there’s some strength coming in here in the short-term and one of the strongest ones here is waste management, where we see we have that crossover to the upside blue line over black line and we’re seeing shares rally still here. So it really speaks to there’s some areas to get long in the market, certainly metal and mining companies, but you got to navigate this. This is not such a straight ride up like we had when stocks were just moving straight up with the S&P hitting new highs every day, you really want to be careful. Pick which areas you’re involved in the market in, and also get exposure to these tremendous opportunities that are heavily driven by commodities.
And this is really making it clear why you need a tool that understands, Hey, when energies and metals and precious metals and these things start moving around. It really starts rippling through the stock market and opening up tremendous trading opportunities. So we’ll go ahead and leave it there. Once again, this has been the Hot Stocks Outlook for March 4th, 2022. Thank you all for watching. Best of luck and bye for now.
