Hot Stocks Outlook for the Week of December 6, 2019
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 Hormel Foods (HRL), Autodesk (ADSK), Shopify (SHOP), United Parcel Service (UPS) and United Healthcare (UNH).
This Week’s Hot Stocks Outlook
Hello again traders, and welcome back to the Hot Stocks Outlook for December 6, 2019. I hope you all are having a great week out there in the financial markets, back from our Thanksgiving holiday, and plenty of opportunities to cover. We’re getting a little bit of volatility in the markets, but when you have a tool like VantagePoint, it’s going to help you navigate all of that. So we’re going to go ahead and we’ve got Hormel Foods here. We looked a little bit at Autodesk last week. We’ve got Shopify, UPS and United Healthcare, which a lot of focus on that healthcare and biotech space have been a really tremendous place for trading opportunities.
But starting here with Hormel Foods, and this is a great example of how every single forecast works within this software. But what we have here are daily bars and candles, so each one of these represents a full and complete trading day. And you’ll see that against that price data, there is a black line and also a blue line. So let’s focus on that for right now. Well, what that black line is that is an actual simple moving average, so it’s a very common technical indicator, just takes the past 10 close prices, adds them all together, divides by that number. And really the problem with technical indicators like this is that they’re only looking at past price data, and they’re only able to look at the one market in isolation as if it’s not affected by ETFs and other related stocks and the S&P 500.
So what we want to do is actually compare the value of that lagging indicator to the value of this blue line that you see against the chart. Now that blue value that you see against the chart, that is a VantagePoint proprietary predicted moving average. And for that value to be generated, VantagePoint is not just looking at Hormel Foods and where the market closed over the last few days. It’s looking at related ETF groups. It’s looking at related individual stocks. It’s looking at currencies, looking at futures markets. Obviously things like cattle prices, hog prices, are going to affect a big meat producer. Right? So all of these markets share extremely important relationships with the target market that you’re trying to trade. And then it uses that Intermarket data to actually generate a prediction, so future prices that haven’t yet occurred. You can think about it like a couple candles in the future that aren’t there yet, and it builds those into the value of these indicators, turning what was a lagging indicator into a forward-looking predictive indicator.
So when we look at that value, what it’s telling us is average prices are expected to start moving higher once that blue value crosses above the black lagging value. Now in addition to that predicted moving average, you also have a couple of other indicators that are really arranged to look at different time periods, but also utilizing that predictive technology. So at the bottom of the chart here, you see that you have this green or red bar. And it updates every single trading day. Now what that is, is an extremely accurate indicator, upwards of over 80% accurate, but it’s looking ahead two trading days at a time, so you can think of it as two candles at a time. And it’s very short term strength or weakness in the marketplace.
So what’s really helpful for traders is when you have a directional bias, you know how you want to trade that market, you know when there’s strength or also some short-term weakness, so you can actually be ready to go ahead and buy on dips and withstand that little bit of volatility that may come through. Now to round out the entirety of these forecasts, you also have a predicted high and a predicted low. You see this shadow bar here that every evening before the next trading day occurs, at 6:00 PM, you have a daily range of where you can go ahead and use that to set limit orders, use it to set profit targets, depending on your trading strategy. But when we look at all of these indicators together, the overall trend, short-term strength or weakness predicted highs and lows, it really rounds out the entirety of this forecast.
So we can see that, okay, well, if you’re looking to buy Hormel Foods, every single day you have these levels coming in before the trading day occurs, so you can have limit orders just waiting at these predicted lows and understand, okay, I’m a trend trader, want to get long in this market, and want to buy down at these predicted low levels. You see a day like this where before the trading day occurs, it’s telling you that predicted highs and lows are slanted up, neural index is up, the trend obviously still up. And look, you come all the way down to the predicted low and then explode higher in the market. See, one, two, three, four, five, six, seven, eight, nine, 10, 11, 12 entries here as the market just immediately moves higher from those entries within the subsequent 48 hour period thereafter.
But a really nice move here in Hormel Foods. A lot of opportunities throughout the marketplace, you see here this market up over 10%, but it works the exact same way regardless of the markets you’re trading. So we looked a little bit at Auto Desk last week, and this is a really nice opportunity again. Very simple, right? Blueline over the black line, neural index very bullish over the duration. You see you have a couple little blips here where you get a little bit of price action below that predicted average, but the overall trend, still a lot of separation between your prediction and that lagging moving average.
But what I just really wanted to highlight was really these predicted highs and lows. And you see that again, before this trading day here, where you get this sell-off, you already have a slanting lower in your predicted high and predicted low range. Look at this where you come much, much lower. Again, this predicted low sitting right down there and saying, “Look, that’s where you want to go ahead and look to be a buyer as a short-term trader.” You see the market gaps down. You’d actually get filled at the open, and then the market moving higher once again. So overall, this has been a really nice opportunity again, multiple opportunities, again, along the way. Just trying to highlight how if you can identify trending markets and then say, “Okay. Let me come in with these tools from VantagePoint to do some of that short-term trading, make sure you stay on the right side of the marketplace.”
So AutoDesk here, again, a fantastic opportunity. A little bit of a pullback from last week, but buying in at those levels, you’re up in the trade. Market’s up over 20% in the past 26 trading days. Shares of Shopify here, same thing. Right? Crossover between the blue line and the black line saying this trend’s going to start moving higher. But look at this neural index. And how I like to think of the neural index is again, it’s very short-term. It’s only 48 hours, and it’s always updating. Right? So it’s only looking ahead 48 hours at a time, keeps updating that level. Well, you see that once that neural index goes bearish, you see that you’re trading at the lower part of the predicted moving average. So if we have this extremely accurate forecast of where average prices are going to be moving forward, and we expect short-term weakness over the next two trading days or 48 hours, well, expect the market to move below that predicted moving average. Right?
On average, you should expect the market to trade above and below and average. And again, you see these predicted lows here just waiting for you as great opportunities to be buying. And even on days like this where you get a lot of volatility, look at the market come all the way back to that predicted low level. The next day again, if you’re buying there you get filled at the limit, and this market really moving higher over the past couple days with a nice … While the markets are selling off, this being an area of the market that actually is doing quite well here. But you don’t want to get psyched out by just looking at the S&P 500 or something like that. You want to focus on this individual market, what’s going on with these Intermarket relationships, and how are they going to affect future prices moving forward with an extremely high level of accuracy here.
You see another 19% rally in just the past 14 trading days. So this stock here, you don’t have to buy a whole lot of shares. But you want to focus on that percentage gain just over the past few weeks here.
Next, we’ve got UPS. Now what’s interesting is we got that little bit of sell-off in the S&P 500 over the last couple of days. But the real opportunities were actually coming through a couple weeks ago if you did want to go ahead and get short. And that’s where you see you end up benefiting even more in these areas that have already been forecasting some weakness here. But again, same thing, we’re crossover to the downside here. You do not want to belong to shares of UPS. This is going all the way back now to November 18th is when that crossover comes through. You see you get a lot of that weakness.
And again, as a short-term trader coming in and saying, “Okay. Well, maybe I want to hedge my portfolio, trade that weakness.” You see you get filled at the open if you have a limit order waiting at these levels, and again, a couple of days where you get this slanting higher in the predicted highs and lows. But the overall trend’s still very much to the downside. And you see when that neural index accelerates to the downside, the market much, much weaker, especially from those predicted high levels. So really great opportunities if you’re looking for places to short. Just identify where VantagePoint has highlighted that weakness, and then go in and execute that trading strategy. But you really have the ability to belong in places like biotech, healthcare stocks, United Healthcare. We’ll take a look at that next.
But really hedging that portfolio, getting short in areas where you see UPS off about 6% here, and this trend still looks pretty weak there. So we’ll go ahead and maybe update this over the next couple weeks, see how things have moved forward with UPS.
But United Healthcare, we came into this and brought it into the outlook in early November here. And I just want to highlight how the forecasts work moving forward. So when you understand that, okay, well, here’s the start of the opportunity. Right? There’s where that trend is forecast to reverse. But when you’ve got something that’s working for you, you really want to go ahead and push that advantage because you can trade with profits and add to that position. So you’re not really taking a huge amount of risk, you’re only using accumulated profits to maybe trade a little bit larger than you generally would because there’s not really as much risk there if you’re trading with those accumulated profits here.
But you see that multiple opportunities in the early goings to go ahead and get long in this market. But just over the past couple of weeks here, really past couple of months since we last looked at this, the trend’s still very much to the upside. So if we go ahead and then from about this period on, look at those predicted highs and lows, what’s going on here? It’s got a little bit of gap down here but nail the predicted low, nail the predicted low. Hit it there. We’re getting a little bit of a pullback here. But even more recently, you pull back, now immediately trading to those predicted highs. We’re getting very close as far as that predicted moving average right on top of the actual moving average. So again saying, “Expect prices to run sideways,” really from all the way back here, it was saying, “Look. Expect some short-term weakness over the next 48 hours.” But the short-term trading you’ll understand, look, buy that weakness. Take some profit when you get that balance higher, and you can reassess these things. But multiple opportunities over the past couple months to again focus on this area of the market.
So one of the great features within the software is actually this intelliscan, and it allows us to identify where these really great opportunities are beginning. So I can actually go ahead and really quickly here, I’ll show you how some of this works. But we can go ahead and actually drag in all of these stocks into the intelliscan area. And let’s say you’re a shorter-term trader, but you’re looking for some established trends. Right? Well, what we can do is go ahead and say, “Okay. Well, let’s look for markets that have been trending from our predicted moving average for over a few weeks here, 12 days.” And then we can easily just go in here and say, “Okay. Well, let’s make sure those are to the upside.” We have some predictive tools here as well as far as different trend forecasts. And say, “Okay. Well, let’s look for something that’s moving here to the upside.”
We’ve got a neural index as well. And you see all these opportunities coming through where you can say, “Okay. Well, let me go ahead.” And say, “Okay. Where is there an established trend? Where are all of my predictive tools still saying the market’s moving higher?” And then just like United Healthcare, just like UPS on the downside, go in with those predictive tools and say, “Okay. Well, where should I be looking to go ahead and add to this position?” And that’s where you can do some short-term trading, but understand that you’ve got a lot of the odds on your side when you’ve got 48 hour forecast week, the overall trend week, and you’re at one of those intraday levels to go ahead and take a position. So again, just fantastic trading opportunities all throughout the marketplace. Still a lot of the areas still looking pretty strong here.
You look at shares of Hormel, the healthcare stocks still haven’t seen those crossovers move to the downside quite yet. But of course, we walk these things forward. And as the market conditions change, VantagePoint lets us know to go ahead and change our position, maybe put on certain hedges that are really going to go ahead and benefit us when these trends break out and these opportunities really start to accelerate.
So once again, this has been our Hot Stocks Outlook for December 6th, 2019. Thank you all for watching. Best of luck, and bye for now.