From the Desk of Ian Culley @IanCulley

Precious metals bulls have plenty to be excited about.

Major headwinds have abated as rallies cool in real yields and the dollar.

Gold futures are trading above their former commodity supercycle peak.

And the yellow metal is printing new all-time highs priced in every significant currency except the US dollar.

Even mining stock stocks are breaking out!

From the Desk of Ian Culley @IanCulley

The tide is turning for commodities now that the dollar and rates are falling.

Crude oil is relinquishing its leadership role. Gold and silver are catching a bid. And copper is digging in at former support.

But it’s not only base and precious metals bouncing off critical levels…

Check out our Equal-weight Commodity Index refusing to roll over:

Our commodity index, comprised of an equally weighted basket of 33 commodities, is finding support at a shelf of former highs. This is the principle of polarity at its finest – former resistance turning into support.

From the desk of Steve Strazza @Sstrazza

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

From the Desk of Ian Culley @IanCulley

The market barely reacted Wednesday afternoon following Powell’s remarks, cooking up a big, fat nothing burger for investors.

Market participants took the decision to leave rates untouched in stride. After all, the pause in the hiking cycle was the expected outcome. Since investors already pegged the Fed, the valuable information hung on Powell’s words or forward guidance.

Yet judging by today’s performance, it appears the market just needed a little time to marinate. 

Yesterday’s failed reaction has given way to a delayed response as long-duration bonds scream higher. 

But before we get ahead of ourselves and rush out to buy the bond market bottom, let’s check the charts…

First, the monthly 10-year T-note chart:

From the Desk of Steve Strazza @Sstrazza

When investing in the stock market, we always want to approach it as "a market of stocks."

Regardless of the environment, there are always stocks showing leadership and trending higher.

We may have to look harder to identify them depending on current market conditions. But there are always stocks that are going up.

The same can be said for weak stocks. Regardless of the environment, there are always stocks that are going down, too. 

We already have multiple scans focusing on stocks making all-time highs, such as Hall of Famers, Minor Leaguers, and the 2 to 100 Club.

We filter these universes for stocks that are exhibiting the best momentum and relative strength characteristics. 

Clearly, we spend a lot of time identifying and writing about leading stocks every week, via multiple reports.

Now, we're also highlighting lagging stocks on a recurring basis.

Welcome to the Short Report.

From the Desk of Ian Culley @IanCulley

The Bank of Japan is loosening its grip on the Japanese benchmark yield.

And the dollar, the euro, and the pound are ripping to fresh highs versus the yen.

Yes, the USD/JPY is off to the races – again.

But where can we define the next logical upside objectives?

Let’s dive in…

Before tackling our targets for the dollar-yen pair, check out the Japanese 10-year yield:

The BoJ’s yield curve control policy has, in large part, capped the USD/JPY rate as traders and policymakers play a game of chicken. Traders drive the dollar-yen pair higher, challenging the Japanese central bank's hold on interest rates.

Meanwhile, the BoJ steps in with policy decisions supportive of the yen.   

From the desk of Steve Strazza @Sstrazza.

Welcome back to Under the Hood, where we'll cover all the action for the week ended October 27, 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 seeing an unusual increase in investor interest.

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 Ian Culley @IanCulley

Investors love a good gold debate.

"Is it a commodity, or is it a currency?"

I’d argue it's both.

But, today, I want to focus on gold as a currency in light of a series of new all-time highs versus fiat overseas.

From the Desk of Ian Culley @IanCulley

Everywhere you look, commodities argue a strong case for the next supercycle.  

Live cattle, feeder cattle, sugar, cocoa, and orange juice are all amid historic rallies. Even gold’s resilience in an environment where it should struggle speaks to an underlying demand for raw materials.     

Well, perhaps not everywhere…

While orange juice busts loose on a parabolic advance and cocoa rips toward all-time highs, copper futures barely exceed their year-to-date lows.

On the bright side, it stopped falling.

Check out copper digging in at key pivot lows from earlier this spring:

From the Desk of Ian Culley @IanCulley

It’s beginning to feel an awful lot like 2022.

Rates and the dollar are on pause, bonds can’t stop falling, and the major equity indexes are violating critical support levels.

But the 2s10s spread raised serious questions this week as it hit fresh 52-week highs. 

So, is the market environment changing?

Let’s find out…

Check out the 2s10s spread challenging zero from below:

An inverted yield curve (widely measured by the 2s10s and 3mo.-10yr. spreads) has cast a pall over capital markets, promising an economic recession for over a year. Yet the US economy remains strong.

From the desk of Steve Strazza @Sstrazza

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: