A risk off environment persists. Leadership areas are coming under pressure as market correlations rise (as they typically do in periods of stress). We are reducing our exposure and move to the sidelines to ride out this period of volatility.
[PLUS] Weekly Market Perspectives – Looking For Evidence That A Bull Market Is Re-Born
It’s hard to get away from the crowd when you only ask the questions that everyone else is. When we ask better questions, we get more relevant answers. The questions being most asked right now focus on whether we are going into a bear market and whether we are seeing capitulation (“Was that the bottom?”).
- A bear market has been evident beneath the surface (at least since late 2021, but in some ways for over a year). It’s now showing up in the indexes. The Value Line Geometric Index is below its 2018 highs (as well as its Jan 2020 pre-COVID peak) and is in a 20% drawdown (the line in the sand many use to identify bear markets).
- I understand the allure of trying to call a bottom in real-time (or close to it). But I’ll let the market sort that out. The crowd, focusing almost exclusively on their favorite sentiment data, has been doing that all year and so far at least, they have been wrong.
The questions on my mind are “what do we tend to see when bull markets are re-born and what is the evidence that we are moving from a period of rising volatility to one of sustained strength.
[Video] Fox Business w/ Liz Claman: Where’s The Secular Leadership?
The selling pressure in stocks and other risk assets continues to persist.
What are we looking for to turn this thing around?
I sat down with Liz Claman yesterday on Fox Business to discuss exactly that.
This one is short and sweet. What are the key levels? Where are we looking for leadership?
If bonds catch a bounce, who will lead out of the hole?
My #1 thing right now
Follow the Flow (05-09-2022)
From the desk of Steve Strazza @sstrazza
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.
We also weed out hedging activity and ensure there are no offsetting trades that either neutralize or cap the risk on these unusual options trades.
What remains is a list of stocks that large financial institutions are putting big money behind.
And they’re doing so for one reason only: because they think the stock is about to move in their direction and make them a pretty penny.
Then we flip through our list of stocks flashing unusual activity and pick the best setups using many of the same technical filters we do for our other scans.
And, just like that, we’ll follow the money flow and fatten our own pockets along with some of the world’s most powerful financial institutions.
The Minor Leaguers (05-09-2022)
From the desk of Steve Strazza @Sstrazza
Welcome to our latest Minor Leaguers report.
We’ve had some great trades come out of this small-cap-focused column since we launched it back in 2020 and started rotating it with our flagship bottom-up scan, Under the Hood.
We recently decided to expand our universe to include some mid-caps…
For the first year or so, we focused only on Russell 2000 stocks with a market cap between $1 and $2B.
That was fun, but we wanted to branch out a bit and allow some new stocks to find their way onto our list.
The way we did this is simple…
To make the cut for our new Minor Leaguers list, a company must have a market cap between $1 and $4B.
And it doesn’t have to be a Russell component. It can be any US-listed equity. With participation expanding around the globe, we want all those ADRs in our universe.
The same price and liquidity filters are applied. Then, as always, we sort by proximity to new highs in order to focus on the best players.
But instead of all-time highs, we’re sorting by 52-week highs these days. We don’t want to discriminate against energy or other cyclical stocks.
The goal is still to catch the strongest names while they’re small and have serious upside potential. If any of these stocks ever climb the ranks to the big leagues, the returns could be huge.
We’re looking at up to 10x moves just to break into large-cap land!
Let’s dive into this week’s report and see what’s happening in some of the hottest stocks in the Minor Leagues.
[PLUS] Weekly Market Notes & Breadth Trends
From the desk of Willie Delwiche.
Key Takeaway:
- Volatility is taxing investor portfolios
- Stocks reckoning with new liquidity regime
- New lows are expanding as selling pressure crescendos
Stocks remain weak and selling pressure has intensified. Risk On indexes are breaking down and the Risk Off environment remains intact.
Some see volatility as the price of admission that investors need to pay to receive the long-term return potential in stocks. I see it as a portfolio tax that you are better off not paying. It should not be a surprise that in avoiding an equal number of the best and worst days in the market, portfolios experience less volatility and better returns over time.
While we cannot hand select the days we want to avoid, we do know that the biggest up-days and down-days tend to cluster together in periods of market stress. Our risk management approach suggests investors benefit from less exposure to risky assets during those periods.
[PLUS] Weekly Momentum Report & Takeaways
From the desk of Steve Strazza @Sstrazza
Check out this week’s Momentum Report, our weekly summation of all the major indexes at a Macro, International, Sector, and Industry Group level.
By analyzing the short-term data in these reports, we get a more tactical view of the current state of markets. This information then helps us put near-term developments into the big picture context and provides insights regarding the structural trends at play.
Let’s jump right into it with some of the major takeaways from this week’s report:
* ASC Plus Members can access the Momentum Report by clicking the link at the bottom of this post.
- « Previous Page
- 1
- …
- 293
- 294
- 295
- 296
- 297
- …
- 628
- Next Page »
