From the desk of Steve Strazza @Sstrazza

Check out this week's Momentum Report, our weekly summation of all the major indexes at a Macro, International, Sector, and Industry Group level.

By analyzing the short-term data in these reports, we get a more tactical view of the current state of markets. This information then helps us put near-term developments into the big picture context and provides insights regarding the structural trends at play.

Let's jump right into it with some of the major takeaways from this week's report:

* ASC Plus Members can access the Momentum Report by clicking the link at the bottom of this post.

Macro Universe:

• This week, our macro universe was positive, with 68% of our list closing higher with a median return of 0.48%.
• Lumber $LB was the winner again, closing with a 14.32% gain.
• The biggest loser was the Volatility Index $VIX, with a weekly loss of -6.75%.
• There was a 2% gain in the percentage of assets on our list within 5% of their 52-week highs – currently at 13%.
• 55% of our macro list made fresh 4-week highs, and 36...

From the desk of Steve Strazza @Sstrazza

Our Top 10 Charts Report was just published.

In this weekly note, we highlight 10 of the most important charts or themes we’re currently seeing in asset classes around the world.

Investors Reach for Risk

Last week, the High Beta (SPHB) versus Low Volatility (SPLV) ratio reached its highest level since April of last year. This action speaks to risk-seeking behavior and offensive positioning. As long as these new highs hold, we're looking for equity markets to follow higher in the coming weeks.

From the Desk of Kimmy Sokoloff

The market sold off most of the day, and, as of now, we're holding at $SPX 4,015.

Should we break below the eight-day moving average, we can head to SPX 3,992.

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

A little pullback in stocks today has opened up the window for us to sell some options premium as a nice portfolio hedge for our predominantly long portfolio.

We don't need a long preamble here. The plan is simple: I'm going to enter a delta-neutral credit spread in an ETF that is currently atop my list of ETFs sorted by implied volatility.

2023 is on the cusp of producing as many days with new highs greater than new lows in its first month as 2022 produced over the course of the entire year. Yet there are hurdles to overcome to convincingly argue that this recent strength is sustainable.

More Context: From a macro data and Fed policy perspective, this week holds the promise to be pivotal. That is no less true from a price perspective. More stocks making new highs than new lows is bull market behavior. The S&P 500 not clearing its December high (in the context of still declining longer-term trends) is not. In addition to further trend improvement, renewed expansion in the number of stocks making new highs and continued recovery in our industry group trend indicator would be evidence of rally sustainability. Our equity models aren’t waiting for “what ifs” and while the S&P 500 is an option, it’s not the only one. Our equity positioning is increasingly outside of the US and away from large-cap growth stocks.             

In our ...

From the Desk of Ian Culley @IanCulley

Plenty of gold bugs have Krugerrands buried in their backyard or basement –  if not secured in a safety deposit box at their local bank.

It’s no wonder gold falls under the “end-of-the-world” category of assets.

Regardless, gold prices can also rise with risk assets.

I raise this point not only as an important reminder but because it’s pivotal to understanding our bullish thesis for precious metals.

It’s a metals story….

When I say Gold 5k, it’s in the same breath as $8 Copper. The structural uptrends for these metals are inseparable in my view, as both stem from a new commodity supercycle.

The overlay chart of Copper and Gold futures tells the story:

Both metals carved out big bases and resolved higher back in the early 2000s. Those base breakouts led to Copper tripling in price as Gold rose almost 500% during the preceding cycle. 

I believe a similar base-building process is taking place now. An upside resolution for one likely coincides with a breakout from the other.

That’s why I find the current strength from Copper, Tin, and other metals...

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

As well as stocks all over the world have been doing over the past few months, the overhead supply in the major US Large-cap Indexes remains in place.

In other words, these large-cap, growth-heavy, market gauges still have work to do.

A couple of months ago we reiterated our more neutral positions in the Dow Jones Industrial Average and S&P500, wanting to focus more of our attention on individual stocks and sectors.

That tactical approach has worked out well.

But fast forward to today, and...

Another positive week -- add it to the growing tally!

This is the first time Bitcoin's been up for four consecutive weeks since August 2021. Similarly, Bitcoin's 14-day RSI eclipsed its highest level going back more than two years.

We have a name for this price action...

Momentum thrusts.

We see them all the time in the beginning stages of new trends.

There's no denying that this move has been impressive. In fact, we'd even argue that it represents a structural shift in this market.

But where do we go from here?

Let's dive into this week's letter.

The most significant insider buy on today's list is a Form 4 filing by Abdiel Capital Advisors.

The hedge fund reported a purchase of $4.8 million in Appian Corporation $APPN.

From the Desk of Kimmy Sokoloff

This week is very busy.

We've got tons of economic data, a Fed rate decision on Wednesday, and Big Tech earnings on tap.