Welcome back to Under the Hood, where we'll cover all the action for the week ended March 3, 2023. This report is published bi-weekly and rotated with The Minor Leaguers.
What we do here is analyze the most popular stocks during the week and find opportunities to either join in and ride these momentum names higher, or fade the crowd and bet against them.
We use a variety of sources to generate the list of most popular names.
There are so many new data sources available that all we need to do is organize and curate them in a way that shows us exactly what we want: a list of stocks that are seeing an unusual increase in investor interest.
In this weekly note, we highlight 10 of the most important charts or themes we’re currently seeing in asset classes around the world.
Don’t Ignore Coal
Our equal-weighted custom index of the largest coal stocks reached new highs last week. If this breakout sticks, coal is a group we want to keep leaning on for long exposure.
From the Desk of Steve Strazza @sstrazza and Alfonso Depablos @Alfcharts
This is one of our favorite bottom-up scans: Follow the Flow.
In this note, we simply create a universe of stocks that experienced the most unusual options activity — either bullish or bearish, but not both.
We utilize options experts, both internally and through our partnership with The TradeXchange. Then, we dig through the level 2 details and do all the work upfront for our clients.
Our goal is to isolate only those options market splashes that represent levered and high-conviction, directional bets.
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.
Silver is clawing its way back after breaking down from a month-long consolidation and undercutting a critical shelf of former lows.
As we talked about last week, it all comes down to risk appetite. Silver bid speaks to a healthy risk-seeking environment favoring all precious metals.
Even with the impressive bounce heading into the weekend, the S&P 500 last week didn’t even get back up to its December high. Meanwhile nearly 10% of the industry groups in the S&P 1500 and more than 10% of global markets closed at new 52-week highs. That’s the longest new high list by the rest of the world in nearly a year.
