Our International Hall of Famers list is composed of the 50 largest US-listed international stocks, or ADRs.
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 50 largest names each week and then apply technical filters in a way that the strongest stocks with the most momentum rise to the top.
Let’s dive in and take a look at some of the most important stocks from around the world.
From the desk of Steven Strazza @Sstrazza and Grant Hawkridge @granthawkridge
While breadth has improved in recent weeks and months, the bulls still have their work cut out for them.
When we consider all our breadth indicators in aggregate, the evidence remains mixed. What else is new!? It’s been that way for the majority of this year.
Many of the major indexes made new all-time highs this week. Meanwhile, some advance-decline lines are moving higher, but others are moving lower. Some are at the top of their range, but others are at the bottom of theirs.
The advance-decline line measures stock market breadth based on cumulative net advances. In other words, it takes the number of advancing stocks on a given day and subtracts the number of declining stocks. That number is then added to the previous day’s value, creating a cumulative advance-decline line.
A/D line divergences occur when price is making new highs and the A/D line is NOT.
Plenty of time is wasted and much virtual ink is spilled pulling apart and putting back together various pronouncements by the Federal Reserve and other central banks. With an FOMC meeting on tap, this coming week will likely be more of the same. Rather than focus on what central bankers are saying, it might be more productive to watch what they’re doing. The average central bank (Fed, ECB, BoJ, PBoC) balance sheet has expanded by 10x over the past 20 years (that’s a 25% increase per annum). There is no realistic expectation that balance sheets will contract any time soon. But the pace of expansion is likely to slow (the Fed is expected to announce a timetable for a tapering of its balance sheet expansion this coming week), and interest rates around the world are on the rise. All of the net gains for global equities over the past 30-plus years have come when a majority of central banks have been in easing mode. Currently, just under 60% of central banks are still easing. But, as inflation remains persistent, we expect the number to fall and liquidity headwinds to rise.
The team is out with a bearish piece on US Treasuries this week. Have a read. In it, they lay out the case why we should be looking to position for further downside trading action in a variety of Treasury instruments.
It's been a while since I've had an opportunity to put a Bear Put Spread on, and these setups look like good candidates for them.
From the desk of Steven Strazza @Sstrazza and Ian Culley @IanCulley
Long-term interest rates have taken a hit this week, while the short end of the curve has continued higher. When we zoom out a bit, yields have been rising across the curve since this summer.
During the past few months, the 2-year yield has ticked higher by more than 30 basis points (bps), the 5-year has increased by almost 60 bps, and the 10-year has gained 40 bps. But when we look all the way out to the 30-year, it's only risen by roughly 20 basis points.
Rates are rallying across the board, Treasuries are trending lower, and bond market investors are favoring TIPS and higher-yielding securities.
Well, we definitely don’t want to be buying Treasury bonds.
In today’s post, we’re going to take a trip around the fixed-income market and discuss some US Treasury funds we can use as vehicles to express our thesis.
In yesterday's note, we outlined our tactical short if Bitcoin was below 59k.
We gave the bears the benefit of the doubt, but they couldn't keep prices under 60k for long at all.
We have no shame in being wrong and flipping our approach as new data comes in. In fact, we pride ourselves on always adapting to new evidence and never being dogmatic. The quicker we know we're wrong the better, because we can move on to bigger and better opportunities. In this case, we knew in just a few short hours!
This seems like a textbook failed head-and-shoulders pattern right now:
"We make our decisions, and then our decisions make us."
I came across that quote in a book I was reading this week (no apologies here -- I read books -- that's what I do).
That prompted me to think about how it was this time last year that I had some decisions to make about what was next in my professional journey. JC and I talked about my joining the All Star Charts team. I (we) made the decision to do just that -- and while the impacts of that decision continue to unfold, I've not regretted it for a moment. And knowing what I know now, that decision seems more obvious than it did when I made it a year ago.
It's not just the active decisions that form us. Where we pay attention matters as well. The 18th century poet William Blake was ahead of his time when he observed how "we become what we behold."
Today, we are here to discuss the areas of the market where despite today's correction, we saw some strength.
Using relative strength charts for analysis is a great tool to have. But there is another way to look at it. When the market is correcting and certain stocks are going up, that is information. That is relative strength. And vice versa of course.
So let's take a look at the sectors that were displaying strength.
What we do here is take a chart that’s captured our attention, and remove the x and y-axes as well as any other labels that could help identify it.
This chart can be of any security, in any asset class, on any timeframe. Sometimes it’s an absolute price chart, other times it’s on a relative basis.
It might be a ratio, a custom index, or maybe the price is inverted. It could be all three!
The point is, when we aren’t able to recognize what’s in front of us, we put aside any biases we may have and scrutinize the price behavior objectively.
While you can try to guess the chart, the point is to make a decision…
So, let us know what it is… Buy, Sell, or Do Nothing?
We use a wide variety of bottom-up tools and scans to complement our top-down approach. This makes it near impossible for us to miss out on favorable trading opportunities.
One way we do 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.
