From the Desk of Ian Culley @IanCulley

The US dollar has stopped going up!

In fact, it’s already registered a slightly lower high and lower low this past month. 

But we can’t call a top in the US dollar yet. While it came close to officially triggering a top last week, the lack of follow-through kept us in our seats.

With fresh monthly candles in the books, let’s review longer-term charts and reiterate key levels for ol’ King Dollar.

How do I measure performance?

In a nutshell, this is a question I received from a member of the All Star Charts community today.

Well, it depends. 

The short and obvious answer: I trade to make money. 

If I’m making money, good. If I’m not, bad.

Of course, there are also more nuanced answers and considerations – some more relevant than others. They come down to relative performance.

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.

From the desk of Steve Strazza @Sstrazza.

Welcome to Under the Hood, where we'll cover all the action for the week ended October 28, 2022. This report is published bi-weekly and rotated with our 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.

For so long it had been Bigs over Smalls.

People would even complain that it was only 5 stocks driving market returns.

Do you remember how hilarious that was?

Good, because it's so much funnier now.

Get this, those same people complaining that only 5 stocks were driving the market higher are now complaining that those 5 stocks aren't participating.

Market returns are currently being driven by all the other stocks. Those 5 big massive ones are doing their very best to hold the market down, but it's not working.

Investors are buying stocks, whether you like it or not. And they're buying the smaller ones at a much faster rate than their larger-cap counterparts.

Look at the Small-cap Russell2000 hitting new Year-to-Date highs vs the Large-cap S&P500.

And of course Small-caps are also hitting new 16-month highs relative to the Nasdaq100:

There are 30 stocks in the Dow Jones Industrial Average.

This is the most important stock market index, both currently and of all-time.

In case you missed my explanation, you can catch up here.

Of the 30 stocks, 5 of them are already at New All-time Highs (2 more that are no longer in the Dow also closed at New All-time Highs).

And several more Dow Components are just a few percentage points away.

New all-time highs are NOT a characteristic of downtrends.

An expansion in new highs is NOT weak breadth.

Here's a Dow component that has been basing for a while. Premium Members of ASC will be very familiar with this one:

These are the registration details for our Live Monthly Candlestick Strategy Session for Premium Members of All Star Charts.

This month’s Video Conference Call will be held on Monday November 7th @ 6PM ET. As always, if you cannot make the call live, the video and slides will be archived and published here along with every other live call since 2015.

Here are the details for Monday evening:

Thanks for all the great comments and emails.

I'm glad to hear how well you guys are doing in this environment.

But keep in mind that not everyone looks at the market the way you and I do.

Some people out there think the Dow Jones Industrial Average is beneath them.

Some people like to pretend to be smart and wait for computers to tell them if stocks are going up, instead of just counting.

Price weighted indexes don't seem to be good enough for some of their boujee lifestyles.

Fortunately, for us simpletons who are only here to make money, we see the Dow Jones Industrial Average rallying for a 4th consecutive week, finishing up the greatest October of all time.

This is the weekly post that aggregates all the charts we put together throughout the week and organizes them all into one, easy to flip through deck.

From the Desk of Ian Culley @IanCulley

Energy stocks refuse to lose.

We can’t deny the relative strength of the energy space, whether we’re talking about stocks or commodities. But it’s been equities over the raw materials for months now.

It doesn’t look like that will change any time soon. However, I doubt energy contracts will be left behind.

Let’s run down the most actively traded contracts for crude, gasoline, and heating oil. First, crude oil:

The December contract has chopped around a key level of former support at 85. Despite the sloppy nature of the chart, I don’t hate a long position here. But that's only if it’s above 85.

From the Desk of Steve Strazza @Sstrazza and Alfonso Depablos @AlfCharts

Our International Hall of Famers list is composed of the 100 largest US-listed international stocks, or ADRs. We’ve also sprinkled in some of the largest ADRs from countries that did not make the market-cap cut. 

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 largest names each week and then apply technical filters in a way that the strongest stocks with the most momentum rise to the top.

Based on the market environment, we can also flip the scan on its head and filter for weakness.

Let’s dive in and take a look at some of the most important stocks from around the world.

Here’s this week’s list:

How great it is that we can change our minds and take decisive action immediately?

As traders in the financial markets, if our spidey senses detect that something is amiss or conditions have changed, we can often liquidate our positions and head safely into cash with just a few keystrokes on our computer. Depending on the size of our positions, we can be completely in cash within minutes, maybe even seconds!

You can’t do that with Real Estate.

You certainly can’t do that with Private Equity investments.

You definitely can’t do that with a small business.

All of those investments are fine for their own reasons. But they don’t offer us the opportunity to immediately exit if we change our minds.

Of course, just because we can change our minds on a dime doesn’t mean we always should. If we’re wishy-washy and trading without a plan, it becomes incredibly easy to overtrade and drive our commission bills and nerves through the roof. While this might make us popular at our broker’s office, our accountants will unlikely be pleased.