The S&P/TSX Composite index edged higher, 2 TSX-listed stocks to consider at the current levels- ERO and ISO

Company Overview: Ero Copper Corp. (TSX: ERO) is a base metals mining company primarily engaged in the production and sale of copper from the Vale do Curaca Property in Brazil. In addition to copper, the company also produces and sells gold and silver as by-products from the same operations. IsoEnergy Ltd. (TSX: ISO) is a uranium exploration and development company focused on the acquisition, exploration, and evaluation of uranium properties in Canada. Its project portfolio includes Thorburn Lake, Radio, Geiger, and several other prospective assets. This Report covers the Price Action, Technical Indicators Analysis along with the Stop Loss Levels, Target Prices, and Recommendations on these two stocks.

Canada Market Round-Up

The S&P/TSX Composite Index (TSX: ^TSX) faced selling pressure throughout the past week, closing at 24,553.40 on March 14, 2025, with a loss of 205.36 points (-0.83%). However, the index rebounded on March 17, 2025, gaining 231.71 points (+0.94%) to close at 24,785.11. Monday’s recovery was led by strong performances in basic materials, real estate, industrials, consumer cyclicals, technology, consumer non-cyclicals, utilities, energy, and financials, while healthcare remained the weakest sector. In economic news, Statistics Canada reported that total manufacturing sales in Canada rose by 1.7% in January, reaching $73.0 billion, reflecting continued strength in the industrial sector. From a technical standpoint, the index remains above a rising trendline support zone, signalling continued strength. It is also trading above the 50-period Simple Moving Average (SMA), which serves as a key support level. The next immediate resistance is near 25,300, while critical support is positioned around 24,000. Additionally, the Relative Strength Index (RSI) on the weekly timeframe stands at approximately 51.82, reflecting solid momentum despite recent declines.

On the macro front, the upcoming major economic events that may impact the Canadian market sentiment include CA CPI m/m, U.S Federal Funds Rate and U.S Unemployment Claims.

Global Markets Wrap-Up 

For the week ending March 14, 2025, U.S. equities experienced downward pressure, with major indices posting losses. The Nasdaq Composite fell 2.43% to close at 17,754.09, while the Russell 2000 declined 1.51% to 2,044.09. On the economic front, labor market data showed a rise in unemployment claims, as reported by the U.S. Department of Labor. Seasonally adjusted initial jobless claims for the week ending March 8, 2025, stood at 220,000, reflecting a 2,000 decrease from the 222,000 recorded in the prior week.                                                                               .

Taking into the US market's performance over the last week, following the major global macros and data front, based on the technical analysis of the S&P/TSX Composite Index, the two TSX listed stocks fit the maximum criteria on the technical framework. The recommendations are based on the generic insights, entry price, target prices, and stop-loss for Ero Copper Corp. (TSX: ERO) and IsoEnergy Ltd. (TSX: ISO) for the next 2-4 weeks.

Ero Copper Corp. (TSX: ERO)

Price Action Analysis (on the Daily Chart)

On the daily chart, ERO stock is holding above a key falling trendline support, confirming a stable base. The recent upward movement, coupled with increasing trading volumes, reinforces a bullish outlook for the stock. In the short term (2-4 weeks), the stock could test the next resistance level at CAD 21.50. A breakout above this level may signal further upside potential while maintaining support at current levels would strengthen positive momentum and buyer confidence.

Technical Analysis (On the Daily Chart)

On the daily chart, the Relative Strength Index (RSI) (14-period) is currently around 54.64, indicating positive momentum. The weekly trading volumes further validate the ongoing uptrend, suggesting strong buying interest. Additionally, the stock is trading above the 21-period Simple Moving Average (SMA), which could act as a dynamic support level, reinforcing the bullish outlook and providing further stability for potential upside movements.

General Recommendation:

As per the above-mentioned price action and technical analysis, Ero Copper Corp. is looking technically well-placed on the chart, and a ‘Speculative Buy’ recommendation has been given on the stock. Investment decisions 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. Ero Copper Corp. (TSX: ERO) was last covered in a report dated '29 January 2025'. Below is the summary of our recommendation.

IsoEnergy Ltd. (TSX: ISO)

Price Action Analysis (on the Daily Chart)

On the daily chart, ISO stock is trading above a downward-sloping trendline support, consistently holding this zone as a key support level. The recent upward movement, supported by rising trading volumes, reinforces a bullish outlook for the stock. In the short term (2-4 weeks), the stock could test the next resistance level at CAD 2.45. A breakout above this level may indicate further upside potential while holding support at current levels would strengthen positive momentum and confirm sustained buying interest.

Technical Indicators Analysis (On the Daily Chart)

On the daily chart, the Relative Strength Index (RSI) (14-period) stands at approximately 42.84, reflecting positive momentum despite being in the lower range. The weekly trading volumes support the recent upside movement, indicating continued buying interest. However, the stock is currently trading below the 21-period Simple Moving Average (SMA), which may act as a resistance level.

General Recommendation:

As per the above-mentioned price action and technical analysis, IsoEnergy Ltd. looking technically well-placed on the chart, and a ‘Speculative Buy’ recommendation has been given on the stock. Investment decisions 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. IsoEnergy Ltd. (TSX: ISO) was last covered in a report dated '23 August 2023'.  Below is the summary of our recommendation.

Upcoming Major Global Economic Events

Market events occur on a day-to-day basis depending on the frequency of the data and generally include updates on employment, inflation, GDP, consumer sentiments, etc. Noted below are the upcoming week's major global economic events that could impact the S&P/TSX Composite Index and listed stocks' prices.

Related Risks: This report may be looked at from high-risk perspective and recommendations are provided are for a short duration. Recommendations provided in this report are solely based on technical parameters, and the fundamental performance of the stocks has not been considered in the decision-making process. Other factors which could impact the stock prices include market risks, regulatory risks, interest rates risks, currency risks, social and political instability risks etc.

Markets are trading in a highly volatile zone currently due to certain macro-economic issues and geopolitical tensions prevailing. Therefore, it is prudent to follow a cautious approach while investing.

Note 1: Individuals can consider exiting from the stock if the Target Price or Stop loss mentioned as per the technical analysis has been achieved and subject to the factors discussed above.

Note 2: How to Read the Charts?

The Green color line reflects the 21-period moving average, while the Red color line indicates the 50-period moving average. SMA helps to identify existing price trend. If the prices are trading above the 21-period and 50-period moving average, then it shows prices are currently trading in a bullish trend.

The Black color line in the chart's lower segment reflects the Relative Strength Index (14-Period), which indicates price momentum and signals momentum in trend. A reading of 70 or above suggests overbought status, while a reading of 30 or below suggests an oversold status.

The Blue color bars in the chart's lower segment show the volume of the stock. The volume is the number of shares that changed hands during a given day. Stocks with high volumes are more liquid than stocks with lesser volume. Liquidity in stocks helps in easier and faster execution of the order.

The Orange color lines are the trend lines drawn by connecting two or more price points and used for trend identification purposes. The trend line also acts as a line of support and resistance.

Technical Indicators Defined: -

Support: A level at which the stock prices tend to find support if they are falling, and a downtrend may take a pause backed by demand or buying interest. Support 1 refers to the nearby support level for the stock and if the price breaches the level, then Support 2 may act as the crucial support level for the stock.

Resistance: A level at which the stock prices tend to find resistance when they are rising, and an uptrend may take a pause due to profit booking or selling interest. Resistance 1 refers to the nearby resistance level for the stock and if the price surpasses the level, then Resistance 2 may act as the crucial resistance level for the stock.

Stop-loss: It is a level to protect further losses in case of unfavourable movement in the stock prices. 

Risk Reward Ratio: The risk reward ratio is the difference between an entry point to a stop loss and profit level.  This report is based on ~60% Stop Loss of the Target 1 from the entry point.

A trailing stop-loss is a modification of stop-loss in case of favourable movement in the price to protect the gains.  Individuals can Trail the Stop-Loss as per the aforementioned levels if the stock price achieves more than 50% of the Target 1. individuals should consider exiting from the position as per the Trailing Stop-Loss level if the price starts moving downwards after achieving more than 50% of the Target 1. 

The reference date for all price data, currency, technical indicators, support, and resistance levels is March 17, 2025. The reference data in this report has been partly sourced from REFINITIV.

Abbreviations

CMP: Current Market Price

SMA: Simple Moving Average

CAD: Canadian Dollar

RSI: Relative Strength Index 

Note: Trading decisions require a thorough analysis by individuals. Technical reports in general chart out metrics that may be assessed by individuals before any stock evaluation. The above are illustrative analytical factors used for evaluating the stocks; other parameters can be looked at along with additional risks per se. Past performance is neither an indicator nor a guarantee of future performance.