We discussed this at length on Tuesday night (re-watch here).

Large-cap Healthcare.

And there's an element of defense to it as well. Let's not get it twisted:

You see how large-cap healthcare does when stocks are under pressure?

Pretty good huh?

Look at the size of some of these bases:

From the desk of Steve Strazza @Sstrazza

When investing in the stock market, we always want to approach it as a market of stocks.

Regardless of the environment, there are always stocks showing leadership and trending higher.

We may have to look harder to identify them depending on current market conditions… but there are always stocks that are going up.

The same can be said for weak stocks. Regardless of the environment, there are always stocks that are going down, too. 

We already have multiple scans focusing on stocks making all-time highs, such as Hall of Famers, Minor Leaguers, and the 2 to 100 Club. We filter these universes for stocks that are exhibiting the best momentum and relative strength characteristics. 

Clearly, we spend a lot of time identifying and writing about leading stocks every week, via multiple reports.

Now, we're also highlighting lagging stocks on a recurring basis.

Welcome to the Short Report.

This is the video recording of our April 5th Monthly Charts Live Strategy Session

From the desk of Steven Strazza @Sstrazza and Ian Culley @IanCulley

King dollar is sitting perched upon its throne. But the floor beneath it is beginning to crumble.

The rally in the US dollar index $DXY isn’t as strong as today's fresh highs would suggest. In fact, when we dig beneath the surface, the dollar is only trending higher against a few currencies over shorter timeframes, while underperforming the vast majority.

Conveniently, the handful of currencies the USD continues to best are the most heavily weighted components of the US dollar index.

This lack of internal strength can be seen pretty much anywhere outside of the chart of DXY itself. Whether we're looking at our USD trend summary table, our custom USD advance-decline line, or the individual crosses themselves, it all suggests the current trend in the dollar lacks support. 

Let’s take a look.

Our USD trend summary table illustrates both the broad weakness as well as those critical areas of strength that are driving the current uptrend in the DXY:  

From the desk of Steve Strazza @sstrazza

This is one of our favorite bottom-up scans: Follow the Flow.

In this note, we simply create a universe of stocks that experienced the most unusual options activity — either bullish or bearish, but NOT both.

We utilize options experts, both internally and through our partnership with The TradeXchange. Then, we dig through the level 2 details and do all the work upfront for our clients.

Our goal is to isolate only those options market splashes that represent levered and high-conviction, directional bets.

We also weed out hedging activity and ensure there are no offsetting trades that either neutralize or cap the risk on these unusual options trades.

From the desk of Steve Strazza @Sstrazza.

Welcome back to our latest Under the Hood column, where we'll cover all the action for the week ended April 1, 2022. This report is published bi-weekly and rotated with our Minor Leaguers column.

What we do here is analyze the most popular stocks during the week and find opportunities to either join in and ride these momentum names higher, or fade the crowd and bet against them.

We use a variety of sources to generate the list of most popular names.

There are so many new data sources available that all we need to do is organize and curate them in a way that shows us exactly what we want: a list of stocks that are seeing an unusual increase in investor interest.

It's Saturday Morning Chartoons time. 

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.

You can find the whole list of trades here.

Below you'll find the full PDF of this week's charts:

From the desk of Steven Strazza @Sstrazza and Ian Culley @Ianculley

The relentless outperformance from commodities and commodity-related assets shows no signs of slowing.

The CRB Index is up 27.03% year to date while the S&P 500 and the 30-year Treasury bond aren’t even in the ballpark, posting lackluster performances of  negative 4.95% and negative 6.25%, respectively.

Commodities are really the only game in town these days.

With that as our backdrop, we want to continue focusing on this asset class for buying opportunities.

As many of these contracts consolidate or correct following explosive upside moves, we’re paying extra attention to those that have been basing in recent months – such as natural gas. 

Let’s take a look.

Here’s a zoomed-out weekly chart of natural gas futures:

From the desk of Steve Strazza @Sstrazza

Our International Hall of Famers list is composed of the 100 largest US-listed international stocks, or ADRs. We’ve also sprinkled in some of the largest ADRs from countries that did not make the market cap cut. 

These stocks range from some well-known mega-cap multinationals such as Toyota Motor and Royal Dutch Shell to some large-cap global disruptors such as Sea Ltd and Shopify.

It’s got all the big names and more--but only those that are based outside the US. You can find all the largest US stocks on our original Hall of Famers list.

The beauty of these scans is really in their simplicity.

We take the largest names each week and then apply technical filters in a way that the strongest stocks with the most momentum rise to the top.

Based on the market environment, we can also flip the scan on its head and filter for weakness.

Let’s dive in and take a look at some of the most important stocks from around the world.

Here’s this week’s list:

From the desk of Steven Strazza @Sstrazza and Ian Culley @Ianculley  

It finally happened…

The yield curve inverted for a brief moment as the 2-year yield rose above the 10-year earlier this week. 

But whether or not it inverted yet is beside the point. It’s been flattening for a long time, and that’s the direction we’re headed in. It's only a matter of time.

While media outlets and fearmongers will spin this development as an urgent warning of an impending bear market, here's what you need to know: Throughout history, equities have done well during and after inversions.

This commonly observed leading indicator has a tendency to precede major market tops by years, not months. In other words, there's still time. The average lead time is about 18 months after prior inversions. 

More importantly, when it comes to forecasting bear markets and recessions, many experts will argue that it is actually not the 2-year we should be focused on, but the 3-month yield. 

From the desk of Steve Strazza @Sstrazza

Welcome to the 2 to 100 Club.

As many of you know, something we've been working on internally is using various bottom-up tools and scans to complement our top-down approach. It's really been working for us!

One way we're doing this is by identifying the strongest growth stocks as they climb the market-cap ladder from small- to mid- to large- and, ultimately, to mega-cap status (over $200B).

Once they graduate from small-cap to mid-cap status (over $2B), they come on our radar. Likewise, when they surpass the roughly $30B mark, they roll off our list.

But the scan doesn't just end there.

We only want to look at the strongest growth industries in the market, as that is typically where these potential 50-baggers come from.

From the desk of Steven Strazza @Sstrazza and Ian Culley @IanCulley

Rates continue to move higher around the world as central banks do their best to combat inflation. 

As investors, our best course of action is to position ourselves in those areas that benefit most from rising rates.

Commodities and cyclical stocks immediately come to mind. But there are also specific currencies that tend to excel in rising rate environments.

Today, we'll discuss a handful of emerging-market currencies with heavy commodity exposure. 

We’ve been waiting on these currencies to catch higher and confirm the price action in commodities since last year… and it looks like it’s finally happening.

Let’s dive in.

First up is an overlay chart of the US 10-year yield and our equal-weight basket of EM commodity currencies: