Thanks to everyone who joined us for today's Hot Corner Insider Weekly Strategy Session.

From the desk of Steve Strazza @Sstrazza

Welcome to The 2 to 100 Club.

In this scan, we look to identify the strongest growth stocks as they climb the market-cap ladder from small- to mid- to large- and, ultimately, to mega cap status (over $200B).

Once they graduate from small-cap to mid-cap status (over $2B), they come on our radar. Likewise, when they surpass the roughly $30B mark, they roll off our list.

But the scan doesn't just end there.

We only want to look at the strongest growth industries in the market, as that is typically where these potential 50-baggers come from.

Some of the best performers in recent decades – stocks like Priceline, Amazon, Netflix, Salesforce, and myriad others – would have been on this list at some point during their journey to becoming the market behemoths they are today.

When you look at the stocks in our table, you'll notice we're only focused on Technology and Growth industry groups such as Software, Semiconductors, Online...

In today’s Daily Digest, we’ll review the following:

1. New position in XLP.
2. No adjustments are needed today.
3. Exited XLB at Profit Target.
4. Current status of open campaigns.
5. Volatility Snapshot.

Let’s dig in!

When it comes to the US economy it is all about the consumer.

It's the best gauge of how things are going.

The Consumer Discretionary Index $XLY does a great job illustrating this theme. 

After breaking out of a nice base in December, prices are now pulling back to that breakout level, threatening to turn into a failed move.

This zone lines up with the prior cycle highs from 2021. 

If buyers are going to step in and show up, this is where it happens. Otherwise, things could get messy.

Bulls don’t want to see this offensive sector losing steam, especially at such a critical level. If buyers don’t step up here, it raises bigger questions about risk appetite and the broader market’s ability to sustain its momentum.

Jeff Macke knows consumers better than anyone.

He just dropped some serious...

Home Depot $HD, the home improvement retail behemoth, reported a double beat and rallied nearly 3%.

It was an excellent report, but our retail expert, Jeff Macke, has pointed out one big problem. The housing market sucks right now.

What stood out to him from the conference call was this: "The higher interest rate environment continues to pressure larger remodeling projects."

The management team also said, "Our customer is very healthy... as they stay in their houses longer, they will take on larger remodeling projects as opposed to moving [but not yet]."

There will come a time when we want to be super long the stock, but that's not today.

The bottom line is that HD is a great American company, and its shareholders have been fabulously rewarded. The stock is up over 1,000,000% since it went public in 1981.

It's one of the best stocks ever.

For now, though, there are too many headwinds against this stock. Until the...

The most notable insider activity today came from MSCI Inc $MSCI, where the Chairman and CEO Henry Fernandez stepped in with a massive $4,913,698 buy.

The CFO and a director of Wolverine World Wide $WWW just filed two Form 4s, revealing a combined $1 million of insider purchases.

When the CFO steps in, it’s especially notable. After all, CFOs have the clearest insight into company financials, growth prospects, and internal forecasts. If they’re buying, it’s worth paying attention.

Here’s The Hot Corner, with data from February 25, 2025:

Click the table to enlarge it.

Millennium Management LLC disclosed a 5.10% stake in TransAlta Corp $TAC via a 13G filing.

And President and CEO James Grech bought 6,684 shares  of Peabody Energy $BTU for a total purchase price of $104,010.

Today's number is... 3

The relative ratio of the Consumer Staples versus the S&P 500 has reached a new three-month high.

Here’s the chart:

Let's break down what the chart shows:

• The blue line in the top panel shows the relative ratio of S&P 500 Consumer Staples versus S&P 500 Index.
• The green and red lines in the bottom panel represent the 14-period daily Relative Strength Index (RSI) for the ratio above. When the line is green it indicates that the ratio is in a bullish regime, while when the line is red it signifies a bearish regime.

The Takeaway: When I’m looking for evidence that market participants are taking defensive positions, the ratio of Consumer Staples to the S&P 500 offers valuable insight.

And right now, I am seeing some of that defensive rotation.

The landscape for one of my favorite risk-on/risk-off ratios has changed considerably. Let me break it down! 

- It has broken out of a short-term bearish-to-...

Growth and large cap factors continue to lead in the green on the US indices table.

Importantly, many indexes have been rejected after testing their most recent highs.

While this isn't a cause for concern, it does suggest that the short-term trend has shifted sideways as many key ETFs are no longer in a period of price discovery.

In these sorts of environments we're always looking for leadership, and that's precisely what retail-expert Jeff Macke is doing. If you want to see his favorite retail stocks, you can get connected by clicking here.

I’ve been thinking a lot about if this could be the end…

On the Morning Show today we talked about whether the bull market for stocks could continue if we lost Bitcoin.

The answer is it definitely could. But, wouldn’t it be strange? 

Crypto and stocks have danced together for a long time.

However, I think it’s less about crypto and more about the overall risk appetite of the market. 

Bitcoin is just one part of it. When I think about risk on corners of the market and the kind of things that should be working during a healthy bull cycle I’m thinking of homebuilders, semiconductors, and banks… to name a few groups. 

But I’m also looking into the relationships between groups. In particular, I’m analyzing the performance of offensive stocks versus defensive stocks. The best ratio for this has always been discretionary vs staples.

XLY/XLP ranks second to none when it comes to the assessment of risk appetite.

In today’s Daily Digest, we’ll review the following:

1. No new positions today.
2. Adjustment to IGV position.
3. No exits since the last report.
4. Current status of open campaigns.
5. Volatility Snapshot.

Let’s dig in!

Home Depot is getting the headlines but there are better trades below the surface

Home Depot is who I wrote about them being last night; a great American company more or less chained at the neck to the US housing market. This morning HD shares are higher by a couple percent after the company reported positive comps for the first time in 2 years and slightly better than expected guidance. 

Listening to the call as I type. The company is taking share, where possible and continues to invest in the business. HD can make you money if you get long during periods of housing recovery but, well, we're not there yet. 

Senior Exec VP Ann-Marie Campbell and CEO Ted Decker on the HD Analyst call just now: 

• "We continue to see softer engagement in larger discretionary projects"
• "The higher interest rate environment continues to pressure larger remodeling projects"
• "Our customer is very healthy... as they stay in their houses longer they will take on larger remodeling projects as opposed to moving [but not yet]"

So, HD...

The most significant insider activity on today’s list comes from Vimeo $VMEO, where the CEO, the CFO, the Chief Product & Technology Officer, and a Director stepped in with a collective $353,000 buy.

It's rare to see four executives step in at the same time, but when it happens in clusters, it signals a strong bet from the top leadership.

Then the President & CEO of Sonoco Products $SON made a bold move, purchasing $929,500 worth of stock. When the CEO makes a buy worth nearly $1 million, it’s worth paying attention.

Here’s The Hot Corner, with data from February 24, 2025:

Over in biotech, Decheng Capital Global Life Sciences Fund took an 18.30% stake in Aardvark Therapeutics $AARD.

And in software, the CEO of Mitek Systems $MITK just purchased $506,000 in stock.

Uncle Warren is red hot right now. 🥵

Berkshire Hathaway $BRK.A / $BRK.B closed at a new all-time high on Monday after it smashed the market's expectations on Saturday.

The company reported operating earnings of $47.4B in 2024, a remarkable increase from $37.35B in the prior year.

In addition, insurance underwriting earnings rose to $9.02B in 2024, nearly double the $5.43B in 2023.

BRK has also significantly benefited from elevated interest rates, as it owns over $300B in U.S. government debt.

Here's the bottom line: the Oracle of Omaha is firing on all cylinders and riding this bull market higher.

Let's talk about what else happened 👇

*click the image to enlarge it

As you can see, Berkshire Hathaway $BRK.A / $BRK.B had the best reaction score on Monday, and Domino's Pizza $DPZ had the worst.  

Now, let's dig into the data and talk about these earnings reactions 👇

Berkshire Hathaway reported a double beat and rallied over 4%. Its reaction score was 4.81...

Today's number is... 55%

Only 55% of S&P 500 stocks are in strong uptrends.  

Here’s the chart:

Let's break down what the chart shows:

• The blue line in the top panel shows the price of the S&P 500 index.
• The black line in the bottom panel represents the percentage of S&P 500 stocks with a 50-day moving average greater than its 200-day moving average.

The Takeaway: In a healthy bull market, the 50-day and 200-day averages typically move in the same direction, with the 50-day average positioned above the 200-day average. 

Looking beneath the surface, only 55% of S&P 500 stocks show strong upward trends. The trend of this breadth indicator has been declining throughout this year and has now fallen back to levels seen at the beginning of 2024. This suggests that there is an underlying weakness in the market, which could pose further downside price action at an index level if the bulls do not address this issue.

Small cracks can also be seen at the index level. Although the S&P 500'...

Cryptocurrencies and crypto stocks are reacting negatively to some of the most positive news they’ve had in years.

It all just speaks to the recent mood shift for Bitcoin and friends. Since the election rally, it hasn’t gone well.

And just think of the news cycle. The first crypto president. A strategic BTC reserve. A non-predatory SEC. Crypto fund approvals. 

The headlines couldn’t be more bullish.

Yet, the average altcoin has suffered a 60% drawdown, and there are literally no cryptos holding up outside of Bitcoin.

I think the next leg for Bitcoin will be lower, as it gets in line with the rest of its asset class. 

In this post, I’ll explain why and what I’m doing about it.

When I think of Bitcoin, I also think of Solana, Ethereum, Coinbase, and Microstrategy… the whole group should work together. It always has. When...

This morning, I started thinking about what still makes this a crypto bull market.

And the answer really comes down to what you’re weighing on the scale.

On one hand, the average drawdown in altcoins sits around 60% from their highs.

Charts like Ethereum and Solana look vulnerable.

Crypto stocks like Coinbase and MicroStrategy are struggling.

Meanwhile, Bitcoin is the last one standing

That’s the bulls’ only argument at this point.

Although BTC remains above a key area of underlying demand, price action has been messy—it looks like one big consolidation.

This can either be a massive distribution and a major top or just a consolidation within an ongoing uptrend.

For me, it all comes down to the VWAP from the US Election and the lower bounds of this range....

We've been discussing the odds favoring shiny rocks outperforming stocks for the foreseeable future. 

It's what happens in every precious metals bull market.

Another classic in these cycles is for the mining stocks to outperform gold. We think this is about to happen. 

In addition, we expect the entire precious metals complex to move explosively. We haven't seen this yet, but we're anticipating it.

The setup in palladium futures looks as juicy as anything in the market.

From the Desk of Steve Strazza @Sstrazza

Welcome to The Minor Leaguers.

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.

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.

We expanded our universe to include some mid-caps.

Nowadays, to make the cut for our 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...