The broadening of participation all over the world continues.
Meanwhile, the pessimism is stronger than ever.
I'm noticing the most angry of people are the ones who want stocks to fall because they don't like the Trump and all his buddies.
But their anger is not the market's concern. If anything, it's just more fuel to drive stocks much higher, which would enrage them even more.
It's pretty hilarious to watch actually.
Laughing is good for you. But laughing at people who haven't bothered to count and actually see how well stocks are doing, is all the more amusing.
You know, you can dislike Trump, and still recognize how strong this bull market continues to be, and how much stronger it's getting week over week.
Here is one of the most important stock market indexes in the world. I would argue that after the S&P500, Dow and Nasdaq, this one is right there behind it, and arguably right along there with it in the same category of importance.
EFA represents developed markets outside of North America. So think a ton of European stocks, United Kingdom, Japan and...
Today I'm going to share a little trick that I like to use to help put the current market volatility into perspective.
The math is like this. I take the value of the VIX and divide by 16. And that's what the market is pricing in for a normal daily move.
For example, if the VIX is at 24, then I would expect a 1.5% move in the S&P500 each day.
So if the VIX is at 16, then I would expect a 1% move.
If the VIX is at 32, then I would expect a 2% move.
Simple.
Now, many people wonder why it's 16, and that's where we get way above my paygrade. If you don't understand how the math around options works, don't worry. No one else does either.
I'm not even joking. Options math is next level impossible. Just ask any of the best options traders. They'll be the first to tell you.
The 16 number I believe has something to do with the square root of the number of trading days in a year, but I'm confident there's more to it than that.
Also, for you statistics majors, I believe there is technically like a 67% probability of these results, or something along those lines.
So keep in mind that The Rule of 16 is just a back of...
Stock market bulls have been watching the homies like hawks.
It's a vital industry right now.
Alfonso recently wrote about the Home Construction ETF $ITB breaking to new lows relative to its defensive peer group, the Real Estate ETF $IYR.
He said, "This ratio has historically been a leading indicator for the broader market. During prior cycles, you can see clear divergences where ITB/IYR tops or bottoms ahead of major turns in the S&P 500."
Our Hall of Famers list is composed of the 150 largest US-based stocks.
These stocks range from the mega-cap growth behemoths like Apple and Microsoft – with market caps in excess of $2T – to some of the new-age large-cap disruptors such as Moderna, Square, and Snap.
It has all the big names and more.
It doesn’t include ADRs or any stock not domiciled in the US. But don’t worry; we developed a separate universe for that. Click here to check it out.
The Hall of Famers is simple.
We take our list of 150 names and then apply our technical filters so the strongest stocks with the most momentum rise to the top.
Let’s dive right in and check out what these big boys are up to.
Here’s this week’s list:
*Click table to enlarge view
We filter out any laggards that are down -5% or more relative to the S&P 500 over the trailing month.
We love our bottoms-up scans here at All Star Charts. We tend to get really creative when making new universes as we want to be sure they will deliver us the best opportunities the market has to offer.
However, when it comes to this one, it couldn't be any simpler!
With the goal of finding more bullish setups, we have decided to expand one of our favorite scans and broaden our regular coverage of the largest US stocks.
Welcome to TheJunior Hall of Famers.
This scan is composed of the next 150 largest stocks by market cap, those that come after the top 150 and are thus covered by the Hall of Famers universe. Many of these names will someday graduate and join our original Hall Of Famers list. The idea here is to catch these big trends as early on as possible.
There is no need to overcomplicate things. Market cap is a quality filter at the end of the day. It only grows if price is rising. That's good enough for us.
Today's trade is a similar bet to yesterday's trade. With $VIX in the 20s and big caps putting in short term bottoms at key pivot points, these are opportunities for opportunistic put spread sellers.