If you're one of these people who thinks the lows for stocks are in, which sectors would you expect to be leading the way higher? The big important groups that fell the hardest, and therefore should bounce the most? Probably.

Well, what if I told you that it's been the opposite.

The leaders off the lows are Utilities, Consumer Staples, Healthcare and REITs:

In our market view update, we outlined how we're approaching stocks after catching last week's 20% rally in the Nifty 50.

In this post, we want to share an intermarket signal that's suggesting a defensive posture remains best when approaching stocks as an asset class.

Last week we looked for a counter-trend rally in stocks and we got it. The Nifty 50 rallied 20% from its intra-week low to its intra-week high, leaving a lot market participants asking if Indian stocks are out of the woods.

In this post, we're outlining why our defensive stance remains and how we're approaching the weeks ahead.

From the desk of Steve Strazza @Sstrazza

This week's Mystery Chart exercise gives us a nice glimpse into the current sentiment amid the recent volatility, so thanks to all those who responded. The overwhelming majority of you we're either selling or doing nothing, which comes as little surprise.

Many of you wanted to sell this chart aggressively and even cited the current market environment as part of you're reasoning. But! The chart was inverted... so all those who were pounding the table to short it were actually buying the Nasdaq 100 (QQQ) relative to the Russell 3000 (IWV).

I'm curious to see how, if at all, this changes your perspective on the chart. Tweet me @sstrazza with your thoughts!

From the desk of Steve Strazza @Sstrazza

In a post earlier this month, we scanned the S&P 500 for the strongest uptrends so that we'd be prepared to buy stocks when the market stabilized. Well three weeks and an additional 25% drawdown later, and we're going to do a similar exercise.

The last two days' rally in stocks confirmed bullish breadth divergences which suggest a tradeable bottom is near and put the S&P 500 back above its 2018 lows around 2350, giving us a well-defined level to manage risk against. If prices fail to hold this level, all bets are off, but as long as we're above it, we think the bias is to the upside over the coming weeks to months. As such, we're looking for long opportunities that offer asymmetric risk/reward setups in the strongest stocks, three of which we outline below.

From the desk of Steve Strazza @Sstrazza

We are constantly analyzing market breadth. We do this not just for insight into the strength of the current trend but also because it helps us identify key turning points. We outlined a variety of deteriorating breadth measures in a post last month to support our bearish outlook on stocks, and the signal turned out to be quite timely as the market collapsed soon after.

With the market now severely oversold amid one of the swiftest bear markets in history, we're looking to breadth measures once again for signs of a tradeable low.

This week we've outlined what we need to see from breadth, the Nifty 50 & Bank Index, and Copper in order to get long Indian stocks from any sort of intermediate or long-term perspective.

Although we've not seen those developments yet, US Stocks (S&P 500) is back above its December lows and other foreign indexes have started to catch a bid in the near-term. This subtle improvement is suggesting some trade opportunities could develop on the long side for those who hold positions for a few days to a week or two.

From the desk of Tom Bruni @BruniCharting

As we look for signs of a tradeable low in Equities, we're not only looking at breadth and the stock market's leaders, we're also looking to the Commodity market for a signal of what's to come.

Let's get into why Copper needs to be on your radar.

As we look for signs of a tradeable low in Equities, we're not only looking at breadth and the stock market's leaders, we're also looking to the Commodity market for a signal of what's to come.

Let's get into why Copper needs to be on your radar.

Do you see how stocks are making new lows? That's a characteristic of downtrends, not uptrends. We first want to identify what type of market environment we're in, and then decide which tools we're going to use to help us profit and manage risk.

Something interesting about the current market is that a lot of stocks are making new lows. Most stocks are. But there are a select few that decided they were going to make new highs instead. We call that Relative Strength. You sometimes hear people say how they're "Bucking the trend". This is that.

Our upside target in Zoom Video $ZM was hit today. That was a quick 40% gain. One for the good guys!

But which one is next? I think it's Docusign $DOCU. The stock is ripping to all-time highs relative to S&Ps and prices have been consolidating nicely. I think the next move is higher. 

In our last post, we looked at the implications of the Nifty 500's breadth and momentum divergences.

In this post, we're outlining the three charts we're watching this week to help determine risk appetite for stocks.

Last week we started to see a few momentum and breadth divergences form in Indian stocks, however, they've not yet been confirmed by price.

In this post, we're going to outline what price level in the Nifty 500 would confirm them, what confirmation would mean for our intermediate-term outlook, and how we're managing risk in both scenarios.