From the Desk of Steven Strazza @Sstrazza

Stocks have enjoyed a powerful rally off their summer lows, as bulls have been in control for about two months now.

A lot of technical damage has been repaired during this time. 

The outlook from sentiment and seasonality assure us the environment is ripe for a bottom. 

Breadth thrusts are stacking up and suggesting we could be in the early stages of a new bull market.

And risk appetite is gradually reentering the market, supporting the bullish price action.

Today, we'll review one of our favorite intermarket relationships, the discretionary versus staples ratio. 

By comparing these two consumer segments, we garner valuable insights about the current market environment and risk appetite in particular.

Here's the large-cap Consumer Discretionary $XLY versus Consumer Staples $XLP ratio:

From the Desk of Ian Culley @IanCulley

Markets constantly provide valuable information. But it’s up to us to listen.

Of course, it’s easy to get caught in a narrative or bias surrounding a particular market. It’s part of the human condition.

And it’s almost a prerequisite. 

In order to step up to the line and assume risk, we need to have a certain level of conviction. At the same time, we must remain open-minded and flexible, willing to receive new information and update our priors.

It’s a balancing act.

And energy is one area of the commodity market that’s keeping us on our toes.

Heading into Q3, we were looking for energy to follow the vast majority of other commodities lower, including base and industrial metals.

So far, that hasn’t been the case. 

The chart below highlights how closely the two procyclical commodities groups have trailed each other heading into 2022:

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 Willie Delwiche.

With the latest surge, the S&P 500 has experienced 17 Momentum Thrusts since 1980. Excluding the signal from earlier this week, eight of these have been accompanied by Breadth Thrusts and eight have not. The difference in the market’s reaction to such moves could hardly be more stark. When accompanied by breadth thrusts, momentum thrusts see strength persist. In these cases, the S&P 500 has never been lower 1, 3, 6 or 12 months later. On average the S&P 500 has been 15% higher 6 months after these momentum thrusts and 25% higher 12 months after the thrust signal. Without a breadth thrust, surging momentum can be climactic and the S&P 500 can struggle to make any headway. The average return 12 months after such signals is less than half the average of all periods since 1980. We don’t hang our hat on any one indicator or single signal. But the combination of breadth and momentum thrusts experienced over the past few weeks suggests investors should be looking for stocks to go higher, not lower, from here.  

...but it might win us cash-money gains, which is all we're really here for anyway. Give the participation trophies to the strivers.

Today's trade comes from a "dirty" sector. One some investors don't like to talk about in polite company. And it certainly won't win us any friends in the ESG crowd. But again, who cares?

Let's get right to it.

This is the video recording of our August 19, 2022, All Star Charts Crypto Weekly Strategy Session.

We've adjusted a position in the Paid-to-Play portfolio today:

The 13D that has everyone’s attention today is not going to be on our list. That’s because we’re looking for insider buying, not insider selling.

Which brings us to meme stock master and Gamestop $GME Chairman Ryan Cohen.

We debuted a new scan recently- The Outperformers.

The Outperformers is our newest scan that pinpoints the very best stocks in the market. It’s the fastest, easiest way to find quality names that are primed for major moves.

The goal is that as the market rally progresses, the sector rotation within the market will reflect in this scan. So while our Top/Down Analysis helps us with the broader view of the market, this Bottom/Up scan makes sure that we catch the slightest change in sentiment.

Commodities are showing up on the green side of the screen these days as we witness a recovery. One of the commodities that have displayed strength time and again is Natural Gas. The price is currently trading at an all-time high and we're here to revisit those crucial levels.

From the Desk of  Ian Culley @Ianculley

The market environment has been shifting in favor of the bulls all summer.

Breadth thrusts are firing as participation beneath the surface expands. Risk assets – commodities and stocks alike – are reclaiming critical levels of former support.

And our bull market rebirth checklist is triggering four out of five criteria.

This is a huge departure from earlier in the year.

But one aspect of the environment remains the same – interest rates. Yes, rates have come off their June peak. And, yes, US yields have paused at a logical level marked by a series of former highs.

That’s all true, and it all makes perfect sense.

But we still find ourselves in a rising-rate market as the underlying uptrend remains intact – for now.

Earlier in the month, we broke down the ranges in the 30-, 10-, and 5-year US yields. Today, we'll turn our attention overseas.

This is the video recording of the August 18, 2022, Weekly Town Hall w/ Willie Delwiche.

08/18/22 2:00 PM ET