Perhaps they’re giving back some recent gains today, but most stocks are.
More importantly, Monday marked the largest one-day rate-of-change for our Coal Index since 2020…
If you’re wondering why we created an index of coal stocks, the answer is simple: The December 2020 delisting of the VanEck Vectors Coal ETF $KOL forced our hand.
They shut down the only coal ETF just as commodities began ripping (many toward new all-time highs). You can’t make this stuff up…
One of our favorite names – Alpha Metallurgical Resources $AMR – has gained over 4,000% off the December 2020 lows. Unbelievable!
Almost four years later, the rally isn’t over for these names.
Our coal index is on the verge of kicking off the next leg higher:
Yields on sovereign debt are chopping sideways across the globe.
The US, France, Germany, Spain, and UK benchmark rates are well below their respective 2023 peaks.
But in Japan, the JGB 10-year yield is hitting its highest level in over a decade.
Check out the Japan benchmark rate cruising above 100 basis points:
Earlier in the week, the Japan 10-year yield reached 1.10 for the first time since July 2011.
While the Bank of Canada, the Swiss National Bank, and the European Central Bank began cutting rates this year, the Bank of Japan (BoJ) may hike later this month.
You can blame it on a plummeting yen or the BoJ’s Yield Curve Control policies.
This time last week, I was arguing a reset had taken place and with Bitcoin testing support, it was a logical place to see buyers step in. As of the writing of this letter, Bitcoin is making new three month lows.
Following this, I want to see a few scenarios play out before entering back into longs with any conviction.
Altcoins are being slaughtered; I keep pointing to the tendency for such topping patterns to fail in the context of bull markets. But again, I need to see the market prove this thesis before acting on it.
There is also a significant divergence brewing between macro and crypto markets.
Here's this week's crypto roundup. It's an opportunity for us to take a step back, set aside the distractions, and delve into the key charts shaping the crypto complex.
As most of you know, we use 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 $30B mark, they roll off our list.
But the scan doesn't just end there.
We only want to look at the strongest growth industries in the market, as that is typically where these potential 50-baggers come from.
[$NKE] appears to be hanging on the precipice of a potentially large fall. The company will be announcing earnings [in late June] and I think that might be the final nail in the coffin to send this stock lower (if not sooner).
