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From the Desk of Ian Culley @IanCulley

I can’t think of a better time to review the major commodity indexes. 

The rising rate environment is reversing, and it’s taking commodities with it.

Let’s dive in and see what’s going on in the space! We also need to check in with a key intermarket ratio, revealing where we want to position ourselves in the coming months and quarters.

Check out the triple-pane chart of the Bloomberg Commodity Index $BCOM, the CRB Index, and our equal-weight index comprised of 33 individual contracts (EW33):

The EW33 remains resilient despite the BCOM and the energy-heavy CRB recently posting fresh 52-week lows. Its buoyancy speaks to lingering strength in various contracts such as orange juice, cocoa, sugar, live cattle, precious metals, copper, and steel.

But the environment is changing as yields begin to turn lower. I find it hard to imagine that commodities – at the index level – will continue to trend higher...

From the Desk of Ian Culley @IanCulley

The Federal Reserve handed down a 25-basis-point rate increase on Wednesday.

And Fed Chair Jerome Powell implied an impending pause in the hiking cycle.

You know what this means...

It’s time to buy the four "Bs" – Bonds, Bitcoin, Big-Tech, and Bullion.

JC and Strazza talked about it on Pardon the Price Action earlier this week.

Today, I’ll highlight bonds with a couple key levels to trade against as we add these assets to our portfolios.

First up is the 7-10 Year US Treasury ETF $IEF:

It’s not there yet. But if and when IEF reclaims the critical shelf of former lows at approximately 100, we’re long!

The next potential resistance level hangs overhead at last year’s August pivot high of 105.75. This is a logical level to take profits or “feed the ducks.” 

But these trades are more about adding bonds back into the mix after last...

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.

We...

From the Desk of Ian Culley @IanCulley

Fed Chair Jerome Powell spoke this afternoon after the central bank announced a 25-basis-point rate hike. 

The fed funds futures were all over the place, from pricing in a 25-basis-point increase to a double-hike. They settled in around a single hike, with a slim chance of a pause.

Exhausting!

It’s clear we can expect increased volatility going forward.

But, instead of guessing the Fed’s next step or parsing Powell's words, I’ll rather sit back, wait, and prepare to trade a decisive breakout.

When I think about the latter stages of the hiking cycle or a potential pause, my mind immediately turns to one currency in particular…

The Japanese yen.

Since the Fed began raising rates last spring, the yen has been one of the strongest trending markets. It stands to reason it could experience a significant trend reversal as the Fed changes course.

Luckily, we have a clear level to set our alerts and define risk. 

Check out the chart of yen futures:

...

This is the video recording of the March 2023 Mid-month Conference Call.

Buyers taking control of a market heading into the weekend exude confidence. And Gold bugs have done it two weeks in a row now and counting, as they reclaimed the former 2011 highs.

So what’s next for precious metals?

Well, if Gold priced in other major currencies is any indication (which I think it is), it looks like new all-time highs.

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.

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...

From the desk of Steve Strazza @Sstrazza.

Welcome back to Under the Hood, where we're covering all the action for the week ended March 17, 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 that are seeing an unusual increase in investor interest.

Click here for a behind-the-scenes look at our process.

Whether we’re measuring increasing interest based on large institutional purchases, unusual options activity, or...

From the Desk of Ian Culley @IanCulley

Precious Metals are back on track, with Gold leading the way.

Gold bugs closed out last week with another strong showing, absorbing overhead supply at a critical level – the former 2011 highs.

With momentum on their side, let’s see how precious metal bulls are faring in other areas of the world.

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 Steve Strazza @Sstrazza

Due to the recent bank failures, this week has been all about the financial sector and the selling pressure taking place there.

However, the price action for energy stocks has been even worse by some measures.

The Energy Sector SPDR $XLE is on pace to fall -6.8% this week, while the Financials Sector SPDR is only lower by about -5.8%.

When we look at energy futures, the outlook only worsens with crude oil registering its largest weekly loss since trading into negative territory in April 2020.

So, what does this all mean for the bull market in energy?

The sector has been so resilient, showing steady leadership for several years now. Is it all over?

Maybe not, but there is some serious damage that will require immediate repair work.

Let's take a look at it.

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:

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