From the desk of Steve Strazza 

Don't miss this weeks Momentum Report; our weekly summation of all the major indexes at a Macro, International, Sector and Industry Group level. As a reminder, we analyze this shorter-term data within the context of the structural trends at play.

From the desk of Steve Strazza @Sstrazza

In our continued effort to identify individual equities that fit within our larger Macro thesis, we recently rolled out our latest bottoms-up scan: "The Minor Leaguers."

We write a post every other week where we outline some of our favorite setups from this universe of stocks.

We've already had some great trades come out of this column and couldn't be happier about the early feedback.

Moving forward, we'll be rotating this column with "Under The Hood" each week.

In order to make it onto our Minor League list, you must have a market cap between $1 and $2B. There are also price and liquidity filters.

Then, we simply sort the stocks by their percentage from new highs. Easy done.

The idea is to catch the strongest names while they're still small and have serious upside potential. If any of these stocks ever climb up the ranks...

This week we're looking at a long setup in the IT sector. Yes, this sector might just be back into rotation! We're also taking a look at an updated target in the Industrial Manufacturing sector.

We retired our "Five Bull Market Barometers" in mid-July to make room for a new weekly post that's focused on the three most important charts for the week ahead.

This is that post, so let's jump into this week's edition.

From the desk of Steve Strazza @Sstrazza

Small-Caps have been outperforming the large-cap indexes by a mile so far this year.

Since January 1st, the S&P Small-Cap 600 is up roughly 25%, compared with just a 5% gain for the S&P 500, and 0% for the Nasdaq 100.

This leadership is showing no signs of slowing, as they once again led the market back to fresh all-time highs this week after a brief and shallow reset.

Not only has the momentum behind this move been astounding, but the S&P Small-Cap 600 just experienced another significant breadth thrust, this time in its percentage of new 52-week highs.

Let's take a quick look at these developments and what they mean for the group going forward.

From the desk of Steve Strazza @sstrazza and Louis Sykes @haumicharts

Markets never operate in a static manner. Instead, markets are dynamic and remain in a natural and constant state of flux.

In knowing this, we must always remain flexible and aware of the changing conditions and developments taking place around us. We pride ourselves on our ability to evolve and adapt to these changes in market structure and are never dogmatic in our approach.

For the last decade, US large-cap growth has been where the alpha is, and derivatives of this theme like large over small, stocks over commodities, and US over international have been very powerful relative trends. We know this well because we've been leaning on them for a long time...

But that's all changed recently, as we've been vocal about the importance of repositioning and decreasing exposure to growth in favor of more cyclical, value-oriented stocks.

If history is any guide, Emerging Markets should be a major beneficiary...

From the desk of Willie Delwiche.

Treasury yields have resumed their upward ascent and the 10-year T-Note yield appears poised to move toward 2.0%. I saw a study this week from Joe Kalish of NDR that suggested such a move would put further downward pressure on the NASDAQ 100 (to the tune of a 20% peak-to-trough decline). Joe’s analysis tends to be pretty astute, so it’s something to think about even if you don’t come to the same conclusion. Another thing to keep an eye on: if these new highs in Treasury yields are going to be sustained, the yields around the world are likely going to echo the move in the US. Right now, yields in both Germany and Japan are shy of their late-February peaks (0.17% for the JGB and -0.26% for the Bund).

In the latest RPP Report put out by All Star Charts, the team remains bullish on the continued sector rotation into energy and oil sector names.

While some of these moves are somewhat extended, there is still a lot of ground to reclaim to get back to former highs. Our bet is the big move is still coming...

From the desk of Steve Strazza @Sstrazza and Ian Culley @IanCulley

In this week’s Commodity Report, we saw a continuance of many of the same themes that we've been pounding the table on for months now.

Mainly, strength in the procyclical areas of the market like Energy and Base Metals. This fits with what we’re seeing in Equity Markets as the rotation out of Mega-cap growth and into more cyclical sectors takes hold.

However, Crude Oil and Copper aren’t the only Commodities catching a bid right now. We’re also seeing strength in the grain markets. 

One of the charts that caught our attention this week was Palm Oil Futures.

Palm Oil is one of the most important Commodities in Asia and combined with Soybean Oil it accounts for roughly 63% of the global production of vegetable oils. Its uses vary from cooking and producing processed foods to personal care products like soaps and fragrances. It also plays a key role as feedstock for biofuel production.

While it's important to understand what we're...

The universe comprises several solar systems- big and small. Similarly, the market comprises several conglomerates- big and small. We're back with another such conglomerate that we'd like to look at today- Bajaj Group.

One of the oldest and most reputable conglomerates of India, the Bajaj Group has been instrumental in generating great returns for investors across the board over the years.

Let's take a look at what the charts have to say.

We created an equally weighted custom index of the Bajaj Group constituents. A big base breakout can be seen here as is the case with several charts in the market. The Bajaj Group seems to have moved out of a four-year base and looks good for another leg of the rally.

Click on chart to enlarge view.

Now let’s take a look at individual stocks and where they stand at present.

From the desk of Steve Strazza @Sstrazza

Our Top 10 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.

1. Dow Averages Take The Driver Seat

At the index level, the Large-Cap Growth-heavy Nasdaq has felt the burden of the last month’s selling pressure. In fact, all other major indices in the US have generated positive returns over the last month. The Nasdaq is the one negative standout. It’s not that we’re seeing money flow out of stocks. Instead, we’re seeing money rotate between stocks.

We shared this chart and observation in our RPP Report earlier this week. Dow Transports and Dow Industrials were barely impacted by the recent volatility, and both have gone on to make new all-time highs since. This has everything to do with the composition of these indexes. The Dow Industrial Average has a lot more Financials compared to the Nasdaq, and half the exposure to Technology. Transports are an even...

This is the video recording of the March 11th Town Hall Meeting w/ Willie Delwiche & Steve Strazza

03/11/21 2PM ET