If we're truly entering into a new crypto bull market, trend-following strategies are the only game in town.
Forget all the rotations taking place because we're entering into the "sit on your hands season."
Overtrading and getting cute is going to be punished, while just sitting on quality coins is likely to be rewarded.
Less trading.
More conviction.
Sit on your hands.
I think that's the play for crypto in the coming months, assuming the bull market is just getting started.
We're talking names like Solana, Avalanche, Luna, Algorand, Elrond, Fantom, Axie among a handful of others as well as the majors like Bitcoin and Ethereum.
In Part 2 of our Fibonacci Series we dive into Frequencies with Jim Bartelloni.
If you're already familiar with my others videos with Bart, you know this is all math. No fundamentals to see here!
In this video we look at the similarities between the shapes made by vibrating grains of sand and the ups and downs of the stock market, particularly the Small-cap Russell2000 ETF $IWM.
Key Takeaway: There’s nothing more bullish than new all-time highs, and there was plenty to go around as we reviewed our monthly charts over the weekend. It’s no wonder that optimism is resurfacing as stocks indexes up and down the cap-scale push to new records. Whether current sentiment will develop into the type of risk-seeking fervor that brought us into the year is unseen. But bulls continue to rise, and interestingly so do the bears. The AAII and II bears ticked higher last week, with II bears reaching levels not seen since May of last year. The backdrop is turning to optimism, but there's still enough pessimism among investors to keep sentiment off of the risk side of the scale.
Sentiment Report Chart of the Week: Equity Love Affair Undiminished
Equity ETF’s have seen half-a-trillion dollars of inflows so far this year. Bonds have seen a fraction of that. Commodity ETF’s have struggled to attract attention despite DBC (a broad commodity ETF)...
From the desk of Steven Strazza @Sstrazza and Ian Culley @IanCulley
We’ve been pounding the table about rising rates for over a month now.
It’s hard not to when they're rising across the curve in both the US and abroad. Cyclical and value-oriented assets have increased in tandem, as energy and financials have become leadership groups.
We continue to see countries with heavy exposure to financials emerging from multi-decade bases. Just last month, the Euro Stoxx 600 made new all-time closing highs, while Italian equities reached their highest levels in 13 years.
But when we look further out on the curve, the long end hasn’t been keeping pace with shorter duration yields in recent weeks.
Taking a look at the 30-year beside the 10- and 5-year yields tells this story best.
As the 5- and 10-year continue to make higher highs and...
The January Effect posits that financial markets experience a seasonal anomaly in the beginning of each year whereby stock prices tend to rise more than in any other month.
But this bullish period extends beyond a single month. In fact, our data show that buyers come out in full force starting in the late fall/early winter.
According to historic seasonal trends, the best time of the year for the stock market is from November to January. Smaller stocks are known to outperform during this period.
And if we’re focusing on small-caps, November is by far the single best month. So it should come as no surprise that the Russell 2000 and S&P Mid-Cap 400 are breaking out to fresh all-time highs this week. They did the same thing last November. In fact, November of 2020 was the best month ever for these small- and mid-cap indexes.
Let’s dive in and discuss some of the seasonal tailwinds supporting these new highs from SMIDs.
Ok, so technically Microstrategy $MSTR is not a bitcoin ETF.
But for those of you paying attention to this space, you know that the CEO Michael Saylor has gotten very long and very loud about his company investing significant portions of its operating capital in Bitcoin. And because of this, the share price of $MSTR stock has since become highly correlated to the price action of Bitcoin.
We were chatting about it this morning and the one thing the team all agreed on is 10 years from now, Saylor is either going to go down as the Greatest Fool in History, or, The Greatest Investing Genius in History. There's really no other outcomes here for him. And you know what? I say cheers to you, Michael Saylor! Way to put your cohones on the line for something you so passionately believe in. Your investors will either one day elevate you to Sainthood or sue you into oblivion. Godspeed.
We've got our popcorn ready and we'll be watching!
Anyway, all of the above makes for fun coffee table conversation. But we traders only care about the price action and how we can profit from it. So let's get right to it.
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.
We held our November Monthly Strategy Session last night. Premium Members can access and rewatch it here.
Non-members can get a quick recap of the call simply by reading this post each month.
By focusing on long-term, monthly charts, the idea is to take a step back and put things into the context of their structural trends. This is easily one of our most valuable exercises as it forces us to put aside the day-to-day noise and simply examine markets from a “big-picture” point of view.
Let’s dive in and discuss three of the most important charts and/or themes from this month’s call.