Writing to let everyone know that the next ASC Premium Mid-Month Strategy Session will be next Monday January 20 at 8 pm ET. 

From the Desk of Steve Strazza @Sstrazza

Welcome to The Minor Leaguers.

We've had some great trades come out of this small-cap-focused column since we launched it back in 2020 and started rotating it with our flagship bottom-up scan, Under the Hood.

For the first year or so, we focused only on Russell 2000 stocks with a market cap between $1 and $2B.

That was fun, but we wanted to branch out a bit and allow some new stocks to find their way onto our list.

We expanded our universe to include some mid-caps.

Nowadays, to make the cut for our Minor Leaguers list, a company must have a market cap between $1 and $4B.

And it doesn't have to be a Russell component — it can be any US-listed equity. With participation expanding around the globe, we want all those ADRs in our universe.

The same price and liquidity filters are applied. Then, as always, we sort by proximity to new...

We're back on The Morning Show today LIVE on Stock Market TV!

If you want to know what's moving markets this week, and how we're thinking about profiting from it, then the Morning Show is for you!

Today's guest is fellow twin-boy dad Todd Gordon, Portfolio Manager at Inside Edge Capital. Todd is an old pal, veteran trader and world class skier. You're not going to want to miss this conversation!

Join us today...

The Mötley Crüe song title comes to mind: Same Ol' Situation. 

It's always the same questions. Every bull market.

How much higher can stocks possibly go? Was that last high the top? Why is the economy not as strong as the stock market? 

That's the thing. We want to pay attention to what's happening around us. Because we've seen it before and we'll see it again. It's just humans being humans. 

I like to turn to the data and weigh the evidence so we can try to make the most informed decisions possible.

The way I see it, this has been a bull market for quite some time, well into year 3 now. Whenever a lagging sector has been most vulnerable to break down from a major top, the opposite has happened.

The money has come in and bought them up. We just saw that in Consumer Discretionary in the back half of last year...

We've been pounding the table on Walgreens Boots Alliance as one of the best potential short squeezes in the entire market. We nailed it!

The stock rallied nearly 30% on Friday for its best earnings reaction ever. 

This isn't an isolated event. Short sellers are getting squeezed all over the place.

Healthcare is one sector that is particularly ripe for a short squeeze. It's home to some of the most hated stocks in the world.

Stocks like Progyny are precisely what we're looking for, and here's why:

• It failed to resolve a massive distribution pattern, proving this stock isn't a zero (at least not yet).
• With 15% short interest and a 7x days-to-cover ratio, there's plenty of juice to spark a short squeeze.
• Short interest is making new 52-week highs, adding to our conviction in the offside positioning.
• Healthcare stocks are some of...

We're in the 3rd year of a bull market and sector rotation continues to be a dominant theme that's driving stock prices higher, and probably more importantly, not allowing them to go lower.

Stocks making new lows is a big deal, and it's a prerequisite in order to have a bear market or a downtrend of any kind. As we discussed this week, the current market lacks this key characteristic - that is new lows. You can't have a market correction without them. It's just math.

Also during corrections, you regularly see rotation into the more defensive stocks, like Consumer Staples. You don't have that either. In fact, Consumer Staples just closed at new all-time lows relative to the S&P500.

...

This is the weekly post that aggregates all the charts we put together throughout the week and organizes them all into one, easy to flip through deck.

Sector rotation continues to be a major driving factor in this market.

We talked about it earlier this week in our LIVE Strategy Session. 

While some sectors and industry groups have been taking a breather, after these historic runs, other stocks have been catching a bid - things like Medical Equipment, Airlines and now Energy stocks.

The one constant, however, is the rotation OUT of Consumer Staples.

This defensive sector consistently outperforms when stocks are under pressure, and when it's a less than ideal environment to be putting risk on in equities.

This is the opposite of that.

Look at the new all-time lows for Consumer Staples relative to the S&P500:

And while Consumer Staples tend to underperform in healthy environments, it's the Consumer Discretionary stocks that outperform the broader markets during the good...

The commodity bears are going into hibernation.

Today was the best day in years for commodities relative to stocks and bonds. 

Inflation expectations are hitting a fresh 30-month high, with crude oil's price breaking out to 10-week highs.

We think this is the beginning of a much longer period of commodity outperformance.

A few weeks ago, we told you a big move in the energy markets was coming. We think this recent price action has marked the beginning of that move.

In addition, we outlined why we're buying copper futures last week, and so far, that trade has been a home run.

What's next?

We think aluminum futures are up next....

This chart, hands down, is one of my all time favorites. It tells the entire story.

Bond yields hit their first long term cycle bottom in the 1940s. Then we had the stagflation of the ’70s, followed by the blow off top in 1982. From there, a nearly 40 year downtrend in yields that ended in 2020.

After that, yields have been grinding higher.

Now, if there’s ever going to be a year where bond yields take a breather, it’s probably this one. 

But here’s the thing. In an environment where inflation refuses to back off, any dips in yields are likely to be short lived.

And let me make this crystal clear… just like I’ve been saying for the last five years: Long bond yields are going to have a hard time breaking lower.
 

And as always, be sure to download this week’s Bond Report

 Allstarcharts Team

Find the Winners in Retail’s Report Card. Jeff Macke’s free retail stock report is your key to...

From the desk of Steve Strazza @Sstrazza

Our Hall of Famers list is composed of the 150 largest US-based stocks.

These stocks range from the mega-cap growth behemoths like Apple and Microsoft – with market caps in excess of $2T – to some of the new-age large-cap disruptors such as Moderna, Square, and Snap.

It has all the big names and more.

It doesn’t include ADRs or any stock not domiciled in the US. But don’t worry; we developed a separate universe for that. Click here to check it out.

The Hall of Famers is simple.

We take our list of 150 names and then apply our technical filters so the strongest stocks with the most momentum rise to the top.

Let’s dive right in and check out what these big boys are up to.

Here’s this week’s list:

*Click table to enlarge view

We filter out any laggards that are down -5% or more relative to the S&P 500 over the trailing month.

Then, we...

From the Desk of Steve Strazza @Sstrazza

We love our bottoms-up scans here at All Star Charts. We tend to get really creative when making new universes as we want to be sure they will deliver us the best opportunities the market has to offer.

However, when it comes to this one, it couldn't be any simpler!

With the goal of finding more bullish setups, we have decided to expand one of our favorite scans and broaden our regular coverage of the largest US stocks.

Welcome to The Junior Hall of Famers.

This scan is composed of the next 150 largest stocks by market cap, those that come after the top 150 and are thus covered by the Hall of Famers universe. Many of these names will someday graduate and join our original Hall Of Famers list. The idea here is to catch these big trends as early on as possible.

There is no need to overcomplicate things. Market cap is a quality filter at the end of the day. It only grows if price is rising. That's good enough for us.

The bottom line is it is a bull market. We...