The magazine cover on the left, describing how Bitcoin was "Storming Wall Street" came just a few weeks before Bitcoin put in a historic top in late 2017. Immediately after this cover story, Bitcoin went on to have one of the most epic crashes of all time.

Investors got wiped out right after the one on the left.

And now here we are after Bitcoin got cut in half, and many of the altcoins are down 70-80% if not more.

There's no denying that the market action over the last month has been hectic.

From the collapse of Terra $LUNA to the crash in governance tokens, not to mention the macro headwinds that have played their role in crypto markets.

With all this noise, let's zoom out and focus on how we're viewing the current situation.

Nifty Auto has been gaining strength over the past week. We're seeing some follow-through there and hence, today's post will discuss a stock from the same sector.

From the desk of Steve Strazza @Sstrazza.

Welcome back to our latest Under the Hood column, where we'll cover all the action for the week ended May 27, 2022. This report is published bi-weekly and rotated with our Minor Leaguers column.

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.

Watch this video for a behind-the-scenes look at our process.

Whether we’re measuring increasing interest based on large institutional...

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.

They’re doing so for one reason only: because they think the stock is about to move in their...

From the desk of Steve Strazza @Sstrazza

Our Top 10 Charts Report was just published.

In this weekly note, we highlight 10 of the most important charts or themes we're currently seeing in asset classes around the world.

Major Levels

The Dollar Index and rates are the two most important charts on the planet right now, and they’re both rolling over. If these two critical areas of the market catch lower, it should provide a much-needed boost to a stock market still grappling with selling pressure. A weaker dollar lifts all risk assets, while lower rates should impact the most beaten down areas, primarily tech. If these tops resolve lower and stocks don’t catch a bid, it raises an important question: What will it take for stocks to rally?

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.

Macro Universe:

• Our macro universe bounced back this week as 91% of our list closed higher with a median return of 3.34%.
• S&P 500 Quality $SPHQ was the winner this week, closing with a 7.65% gain.
• The biggest loser was the Volatility Index $VIX, with a weekly loss of -12.61%.
• There was a 2% gain in the percentage of assets on our list within 5% of their 52-week highs – currently at 11%.
• 66% of our macro list made fresh 4-week...

We retired our "Five Bull Market Barometers" in 2020 to make room for a new weekly post that's focused on the three most important charts for the week ahead.

This is that post, so let's jump into this week's edition.

From the desk of Steven Strazza @Sstrazza and Ian Culley @Ianculley

Not all indexes are created equal… But, some are equal-weighted.

We like to use the equal-weight versions as they level the playing field among components and give us a more accurate view of the participation within a given universe.

This balanced approach adds a crucial layer to our analysis. 

Friday, we highlighted our custom commodity index which assigns the same weighting to thirty-three individual contracts. As we would expect, it’s moving in lockstep with the 10-yr breakeven inflation rate. Both are rolling over in the near term.

Interestingly, the energy-heavy CRB index is not following the same path. It's trading at new highs.

Which one should we trust?

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.

Remember this chart from earlier in the month?

It was comparing the current circumstances to what happened in 2010.

If you recall, the stock market ripped off those March 2009 lows, then in 2010 looked like it was completing a major top, but didn't, and then prices exploded higher instead:

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.