From the Desk of Alfonso Depablos @Alfcharts

A major theme we've witnessed in recent weeks is a shift in leadership as sector rotation continues to spread across the US equity market.

One could argue it is more a general broadening of the rally than it is rotation.

Regardless, one of the major beneficiaries has been Materials.

With commodity markets getting back in gear, industry groups from copper and steel to agricultural inputs are showing strength again.

With broad participation beneath the surface, this is a group we want to be adding long exposure too in the coming days and weeks.

Every week, we create a Power Rankings table that lists the market-cap rank of the top 20 cryptocurrencies. This allows us to see the winners and losers as they climb the market-cap ladder.

In today's Daily Digest, we'll review:

1. No new positions today.
2. Adjustment to XLI position.
3. No exits since the last report.
4. Current status of open campaigns.

Let's dig in!

From the Desk of Steve Strazza and Alfonso Depablos

The most significant insider transaction on today’s list comes in a Form 4 filing by RA Capital Management.

The investment firm reported a purchase of $13.2 million in ARS Pharmaceuticals Inc $SPRY.

In the early stages of my Wall Street career, it was cool being a Gold Bug.

All my heroes were Gold bugs.

I learned in the early 2000s that pricing assets in Gold helped put market trends into context.

The Dow/Gold ratio was the ultimate Gold Bug Chart at the time.

You can see the Dow/Gold ratio here plotted in black, compared to the Dow Jones Industrial Avg itself overlaid in green.

From the Desk of Steve Strazza @Sstrazza

Welcome to The 2 to 100 Club.

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.

From the Desk of Ian Culley @IanCulley

Last week’s tactical setups are heading toward our targets as G10 currencies lose ground against a rising dollar.

If you let the pound or kiwi trade pass, fear not.

The US dollar/Canadian dollar pair is entering our wheelhouse…

Check out the greenback-loonie challenging a key retracement and former resistance level at approximately 1.36:

I placed a stop order above last Friday’s high of 1.3606. 

We put on a bullish bet in biotechs a couple of weeks ago and it quickly rolled over on us. The market had other ideas.

Now here we are, a couple of weeks later, and the biotech ETF $XBI finds itself mired in a range with rising implied volatility signaling elevated options premiums:

In today's Daily Digest, we'll review:

1. New position in XLK today.
2. No adjustments are needed today.
3. No exits since the last report.
4. Current status of open campaigns.

Let's dig in!

There are 3 big divergences right now that I think we want to keep a close eye on.

The first ones comes straight from Papa Dow.

We're looking at a classic Dow Theory Divergence between the Dow Jones Industrial Average and Dow Jones Transportation Average.

We've seen these sorts of things before major market tops. You saw it in 2000, you saw it in 2008, you saw it in 2015 and you saw it in 2020.

In this particular case, you're seeing new highs from the Dow Industrials but lower highs in the Transports:

From the Desk of Steve Strazza and Alfonso Depablos

The most significant insider transaction on today’s list comes in a Form 4 filing by Erik D. Ragatz, director of Grocery Outlet Holding Corp $GO.

Ragatz reported a purchase of roughly $1 million in GO shares.

Bitcoin and Ethereum persist in testing their high timeframe resistance levels, yet the true gains unfold amidst the speculative end.