Here’s my trade on Franco Nevada ($FNV) (May 14, 2020)
FNV GDX GLD SLV FNV ADBE MSFT FNV CLOU FNV CODX
Franco Nevada ( NYSE: FNV ); I put this on our Growth Stock List today, it was a couple of bucks lower than where it is right now and I just want to explain it.
First of all, the fundamentals are pretty much off the chart; they are really, really strong in this company. If you look at the Gold Miners Index ( NYSEARCA: GDX ), and this would be one of those, gold was good. This ( NYSEARCA: GLD ) is very close to breaking out, that’s what I am seeing.
Silver ( NYSEARCA: SLV ) is good as well. So precious metals after all this time; and everybody had been yipping about hyperinflation and this and that and the other thing. Where are the metals? They are starting to break out and so I think you have got several different ways to trade this.
The one that I am featuring is Franco Nevada ( NYSE: FNV ); earnings aren’t an issue, they are not until August. The stock is up; it has been drifting sideways, for how long? A week and a half, almost two weeks drifting sideways with 140.00 as support. You look at the weekly chart and you can see this has had a heck of a sell-off and then a recovery. And then after this point it’s just got blue sky.
You can look at other stocks, looking at this pattern on the weekly chart. You look at Adobe ( NASDAQ: ADBE ); the same kind of deal, it hasn’t broken out yet. Microsoft ( NASDAQ: MSFT ), the same kind of deal, it hasn’t really broken out yet but Franco Nevada ( NYSE: FNV ) has.
So this is a little bit like this one, the Cloud Computing Index ( NASDAQ: CLOU ); where it had this big sell-off, like a total V-shaped recovery and then it did actually break out. And so this one, of all the ones we just looked at, this is the most decisive one right here because it broke out and it has just kept going.
I think you can buy this stock ( NYSE: FNV ) right here and then just give it a trailing stop of about 7 percent or so. And then IF the stock breaks out above 150.00 on volume then maybe you buy a little bit more so you kind of slowly increase your position sizes and the stock works in your favor.
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