From the Desk of Kimmy Sokoloff

Today is the last day of May!

We started the month as high as 417 on $SPY and, as of now, we're at 419.

$QQQ was the leader -- the only index that had real strength, the others not so much.

From the desk of Steve Strazza @Sstrazza.

Welcome back to Under the Hood, where we'll cover all the action for the week ended May 26, 2023. This report is published bi-weekly and rotated with The Minor Leaguers.

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 not going to be finished in my lifetime or in yours or my kids' or grandkids'. That's not the point. The point is to get it started.

~ Korczak Ziolkowski

Last weekend, I took a little six-hour road trip to South Dakota to spend a full day hiking in Badlands National Park. It was amazing. The landscape is stunning and challenging to describe. It’s not quite desert. It’s not quite grassland. It’s not quite mountainous. It’s remote. Some have likened it to a moonscape. But even that doesn’t quite capture it.

You just have to go and experience it for yourself. Trust me – it’s worth it.

I also took advantage of my proximity to Mt. Rushmore to arrive at 7 a.m. the next day. I was one of the only people in the park and was lucky to have Mt. Rushmore to myself for the better part of an hour.

As amazing as Mt. Rushmore is, being there alone on a bright, sunny morning – just me, the birds, and a cup of coffee – was truly surreal. If you ever get a chance to visit the Mt. Rushmore monument, it’s worth getting there early ahead of the crowds.

From the Desk of Ian Culley @IanCulley

"Buy stocks if the US Dollar Index $DXY trades below 105!"

Simple and straightforward. That was our roadmap back in early March.

Now, almost three months later, the dollar is putting that strategy to the test as it approaches 105 from below.

That multi-month consolidation with “continuation pattern” written all over it never continued lower.

Instead, the dollar index has chopped sideways within a tight range for almost six months. And the evidence is beginning to support a possible upside resolution…

The lack of broad US dollar weakness caught my attention back in April. 

Our G-10 currency index and US dollar advance-decline line were printing potential higher lows, while DXY was on the verge of undercutting pivot lows from earlier in the year. The divergence suggested burgeoning USD strength.

Interestingly, DXY has gained roughly 3.5% since.

From the Desk of Ian Culley @IanCulley

All-time highs remain out of reach for gold bugs.

But not all is lost. In fact, I still see constructive consolidations on longer time frames. 

It’s messy. But I’m impressed with gold's and silver’s resilience as they twist and bend beneath supply.

But how low can they go before they break…

From the Desk of Kimmy Sokoloff

The market seemed very slow today after a long holiday weekend.

As of now, the indices are consolidating.

We had a resting GTC order filled at our profit target in the Paid-to-Play portfolio today:

From the Desk of Ian Culley @IanCulley

All-time highs remain out of reach for gold bugs.

But not all is lost. In fact, I still see constructive consolidations on longer time frames. 

It’s messy. But I’m impressed with gold’s and silver’s resilience as they twist and bend beneath supply.

But how low can they go before they break…

For gold, I’m focusing on the prior commodity supercycle peak at roughly 1,924. 

If it loses those former highs, the key retracement level at approximately 1,825 highlights the next potential support area:

The next new position in our Paid-to-Play portfolio is:

The largest insider buy on today's list comes in a Form 4 filing by Carl Icahn, who revealed a purchase of $11.2 million in Southwest Gas Holdings $SWX.

Icahn now owns 15.65% of outstanding shares of SWX.

From the Desk of Kimmy Sokoloff

As I write this note, $SPY has finally filled its gap pre-market at 421.22.

The push higher was brought on by the debt ceiling deal.

From the Desk of Steve Strazza @sstrazza and Alfonso Depablos @Alfcharts

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.