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

1. No new positions today.
2. Rolled KRE to February options.
3. Exited ARKK for Profit.
4. Current status of open campaigns.
5. Volatility Snapshot.

Let’s dig in!

Do you remember when Tesla was on the brink of failure? Some of the most well-known bears on Wall Street were betting heavily against the stock.

This changed in May 2013 when the company reported its first-ever quarterly profit. They also became the first U.S. car company to repay a U.S. Department of Energy loan fully, and they did it 9 years early.

It was a total game-changer.

Since then, it has grown to be an auto-manufacturing powerhouse. What's more, it's the global leader in robotics.

The growth isn't slowing down. It's accelerating.

$TSLA just had its second-best earnings reaction ever. The only other quarter that exceeds it is (you guessed it) Q2 2013.

It wasn't about top or bottom-line results. The real story was in the guidance.

Elon Musk, the CEO, confirmed plans to introduce more affordable EVs in 2025 to expand the customer base.

Moreover, the company is on the cusp of launching ride-hailing services via a robotaxi.

The market rewarded $TSLA with...

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.

...

Today’s standout insider activity features some intriguing moves across key players.

Director Neil de Crescenzo made waves with a Form 4 filing, snapping up 100,000 shares of CCC Intelligent Solutions Holdings $CCCS—a significant bet on the company’s future. 

Meanwhile, at Ardelyx $ARDX, director David Mott—on the board since 2009—dropped a cool $1 million on shares, a bold show of conviction.

Here’s The Hot Corner, with data from December 23, 2024:

Over at Arthur J. Gallagher & Co $AJG, the COO joined the action, purchasing 1,115 shares—a subtle but telling vote of confidence from the executive suite.

Rounding out the action, insider buying also surfaced at Lowe’s Companies $LOW, The Lovesac Company $LOVE, and FB Financial Corporation $FBK, hinting at optimism in a diverse set of industries.

If you've been paying attention this year, you've likely heard about failed tops. They've been everywhere, teasing traders with bearish setups that never materialize. 

Here's how it usually plays out. When support breaks, short-sellers rush to pile on, driving prices lower. But then, the market pulls a fast one. Prices creep back above those broken supports, squeezing shorts and forcing them to cover. Meanwhile, the longs panic, rushing to re-enter.

The latest chatter has been about a potential head-and-shoulders top in Nvidia $NVDA. But let's be real—the bulls are taking back control, and this setup is looking more and more like another false alarm.

Here are three key levels I’m watching in the coming days:

• The VWAP from the August 5th lows at $126.50: This level is the bulls' final line of defense. Prices rebounded from it last week, but a clear break below could trigger a much sharper decline.
• The neckline of the pattern at $132: Price is currently holding above this level, keeping the bias to the upside and the bulls in the...

The market just had a stress test, and gold passed it.

Now, what's next?

We've been monitoring the strength of the United States dollar, which has added to the selling pressure on gold. 

First, check out how helpful this intermarket relationship has been recently:

So JC just got back from a family trip to Disney and all he can talk about is "what a racket" Disney is.

Everything is overpriced, yet people pay. And they pay happily.

It sounds like a pretty good business -- especially if you're an investor.

Of course, we aren't investors here. But all this talk about Disney has us looking at the chart and we like the setup. 

So we're going to get involved.

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

1. No new positions today.
2. Rolled XLE to February options.
3. No exits since the last report.
4. Current status of open campaigns.
5. Volatility Snapshot.

Let’s dig in!

Don't Fight Papa Dow. That's how I learned it.

And it's not just about the Dow Jones Industrial Average itself. It's the 30 stocks that make up the index that we're even more interested in.

If you get the direction of these 30 stocks right, you'll get the market right.

Don't believe me? Go overlay a chart of the S&P500 and the Dow Jones Industrial Average. They're the same.

Tonight is our last LIVE Video Conference Call of the year for Premium Members of Allstarcharts Research.

On tonight's call we're going to walk through each of the 30 stocks in the Dow Jones Industrial Average - one...

From the Desk of Steve Strazza @Sstrazza.

Welcome back to Under the Hood, where we'll cover all the action for the two weeks ended December 20, 2024. This report is published bi-weekly, in rotation 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 simply our proprietary lists of trending tickers, there...

Today’s most notable insider transaction comes via a Form 4 filing from Control Empresarial de Capitales S.A.

The firm disclosed another increase in its ownership stake in PBF Energy $PBF. They now own 28,814,998 shares, representing more than a 25% interest.

Here’s The Hot Corner, with data from December 20, 2024:

Adding to the action, Director Arjun Murti disclosed the purchase of 2,500 shares of ConocoPhillips $COP. 

While smaller in scale, these transactions indicate an insider's belief in the value or potential upside of the company.

Despite a rough couple of months for the entire sector, energy names are popping up on our radar a lot lately.

Even Warren Buffett is buying this dip. After a six-month pause, Berkshire Hathaway reported another purchase of Occidental Petroleum $OXY...

I just got back from a week in Disney with a 4yr old and twin 2yr olds. Wow what a workout! 

The experience further reiterated why I'm long $DIS and why I'm going to buy more.

They got some racket going down there in Florida. $12 hot dogs? $15 popcorn? And lines around the corner with people waiting to buy them?

That's some hustle they got. Good for them.

The way I see it, if you can't beat 'em, join 'em right? You can get frustrated by the money suck if you want, or you can be a shareholder and profit right along with them. I chose the latter when I got back from this Disney trip a year ago.

But let me tell you this, the $12 hot dogs and $300 princess dresses are NOT why I'm long the stock. 

It's that the republicans hate it. They don't like how "woke" the company has gotten. 

And since we know that humans have a hard time separating a company and a stock, there is money to be made here by exploiting those who let their politics and "morals" influence their decision making in public markets.

It reminds me a lot of this Summer when we went...

This year's Santa Claus Rally Period starts on Tuesday.

To clear up any confusion, the official period for the annual Santa Claus Rally includes the last 5 trading days of the year and the first 2 of the following year, for a total of 7 days.

Since 1950, the S&P500 has averaged a 1.3% gain during this period. And if you want to take it back further, since 1928 we've seen an average gain of 1.6%. This compares to just a 0.2% gain for any other random 7 day period throughout the rest of the year. 

Every year is slightly different, depending on which days Christmas and New Years fall on the Calendar. 

The last 5 days of 2024 begin this Tuesday December 24th. And the first 2 days of next year include January 2nd and 3rd. So the official 7 day period this year goes from December 24th - January 3rd. 

And while traditionally, this is a much more bullish time of the year, compared to other periods, the bigger concern is if Santa doesn't show up.

The late great Yale Hirsch, who first discovered this phenomenon in 1972 was quite the lyricist, as I've come to learn. His son...

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.

Did you see how many stocks made new lows this week?

It wasn't many.

When you look at how dramatic people have been about a few stocks selling off a little bit, you would think that an actual correction might be taking place in the market.

But if you thought that humans act logically, then you clearly don't know humans.

Irrational behavior is actually the only thing that the market guarantees. And you saw it again this week.

I mean, you didn't even get an expansion of stocks making new lows!

This was nothing.

All you have to do is go and count. You'll quickly see how the new 52-week lows list is almost non-existent. In fact, you saw fewer new 52-week lows on the NYSE this week than you did in early August.

But if you look even shorter-term, say new 3-month lows, you didn't seen any sort of expansion there either.

Look at the total new 3-month lows among Large-caps, Mid-caps and Small-caps. 

And that's the thing right?

Mathematically, you cannot possibly have a bear market, or a correction of any kind, without the prices of stocks falling.

We know. It's just math.

So if we know that, then...

Mr. Market keeps sending us inflationary signals. Have you noticed?

Last Friday, we talked about cattle futures potentially leading bond yields higher. 

Boy, was that the case this week as bond yields soared on the heels of an FOMC meeting.

We've also talked about a rotation into the energy sector, which has been in the penalty box for most of this bull market.

While this hasn't happened at an index level yet, there have been pockets of strength, like uranium and...

With downside volatility picking up this week, some of you might be wondering if we are on the cusp of a significant market downturn, or is this just another dip that buyers will eventually step into?

It’s worth remembering that every big move starts small, but not every small move turns into something bigger. 

That’s where credit spreads come into play—they act as a reliable barometer of market health, offering insights into investor sentiment and risk appetite.

One effective way to measure them is by analyzing the ratio of the High-Yield Bond ETF $HYG to the Treasury Bond ETF $IEI.

When investors are willing to take on more risk, this ratio typically trends higher. On the other hand, when caution takes over and safety becomes the priority, credit spreads widen, and this ratio declines.

Currently...