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RoboStreet – January 14, 2021
The Reflationary Trade Is On
The investing landscape for 2021 is rapidly shaping up to favor the domestic and international reflation-related sectors. Several positive factors argue well for this thesis in that so many areas that have lagged or been hampered by deflationary forces are back in play and have a lot of room to run.
Bond spreads are widening, which really benefits the banks and insurance companies. Increased construction and the ongoing boom in new home demand is fueling copper, lumber, and chemicals that go into plastics. Soft commodity prices for agricultural goods are on the rise as demand for foodstuffs around the globe is seeing growing trends and even energy is rallying on the notion of marginally higher global demand, but also a surprise production cut by Saudi Arabia.
And remember we’re not talking about day-trading here. I’m looking for 50-100% gains inside of the next 3 months, so my weekly updates are timely enough for you to act.
Depending on how fast the vaccination process goes, there is also a more positive tone surrounding the airline, hotel, casino, cruise line, and restaurant stocks. Delta’s fourth-quarter report released yesterday stated they would return to being cash flow positive by this spring. This is big news and a genuine tea leaf for the epicenter stocks.
Per the investing landscape, the SPY continues to make incremental gains and reached the $380 level as expectations of additional stimulus and infrastructure packages are rising. The main theme for late this week was a rebound in Treasury prices which drove value stocks down (XLE, XLF). Technology stocks rebounded (PTON, AAPL, AMZN).
The new SPY main support remains at the $372 level. The U.S. Dollar and the Treasuries continued to trade in the downtrend. DXY and TLT staged a brief rebound. Earnings season starts this week with major banks scheduled to announce their earnings on Friday.
As long as the SPY is trading above the $372 level, the SPY will continue to make incremental gains and can reach the $380-$385 level second half of January. The bulls have been losing momentum and I still expect up to 5% correction in January-February.
The bull market has resumed its long-term rally and will continue to make new highs into March-April. I would be a buyer using any short-term corrections and use a dollar-cost averaging strategy to accumulate positions. This week has been particularly good to the energy sector with Chevron Corp. (CVX) and Haliburton Co. (HAL) as two leading names showing excellent technical strength within a sector that has come alive in the past month.
When we apply our AI-driven Seasonal Chart tool to CVX, we get a bullish read where the stock is projected to trend higher over the next 20, 30, and 50-day periods. Using another of our AI applications, the Stock Forecast Toolbox, to HAL, we get a strong “B” Model Grade rating and a 10-day predicted resistance price target of $25.39, which is a nice move higher when the stock is currently trading at just under $22.
It’s this kind of advanced and proprietary AI modeling that fuels the tremendous returns in our RoboInvestor advisory service. Our platform is always learning, always thinking, always crunching data 24/7 and the results speak for themselves. Our Winning Trades Percentage is 90.95%. We’re booking profits for our members better than 9 out of every 10 trades where capital is invested. It’s a track record we are very proud of and continue to work on getting an even better performance for the year ahead.
Put RoboInvestor to work for your portfolio. As a member, you’ll receive 2 new recommendations every weekend, so you have fresh money-making opportunities when the market opens on Monday. We tend to hold no more than 25 positions when fully invested and trim it way back when our AI indicators are flashing an overbought market.
The year ahead is full of opportunities and our AI platform finds great investments in stocks and ETFs that are tied to indexes, sectors, interest rates, commodities, currencies, precious metals, and volatility. Become a member today and make 2021 the very best year of wealth building in your life.
And remember we’re not talking about day-trading here. I’m looking for 50-100% gains inside of the next 3 months, so my weekly updates are timely enough for you to act.
*Please note: RoboStreet is part of your free subscription service. It is not included in any paid Tradespoon subscription service. Vlad Karpel only trades his own personal money in paid subscription services. If you are a paid subscriber, please review your Premium Member Picks, ActiveTrader, MonthlyTrader, or RoboInvestor recommendations. If you are interested in receiving Vlad’s personal picks, please click here.
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