One effective way to identify relative strength is by charting one asset class against another.

This approach helps us position ourselves strategically for the current market environment—and right now, it's all about crypto.

Bitcoin is breaking out of a multi-year base relative to the Dow Jones Industrial Average.

The ratio is piercing through the upper bounds of its base, suggesting that BTC is ready to reassert its former leadership.

If this breakout...

Below is the 8th ASC Mastermind  Course. In this video, I got a helpful assist from All Star Charts Director of Research Steve Strazza. 

There's something psychologically magical about dividends. For decades, investors have flocked to all sorts of investment strategies that seek to maximize dividend gains...perhaps because they simply like getting paid to invest. 

But these strategies that focus on dividend-paying stocks...they miss the point entirely. The best way to make money with dividends is not to own the stocks that simply pay the highest yield...it's to own the stocks that pay a dividend while also going up in value.

This is how we avoid common dividend traps like Verizon, AT&T, Phillip Morris, and other companies that have a nice yield but are otherwise garbage investments. 

At All Star Charts, we came up with a new to find the best dividend-paying stocks. We call it The Young Aristocrats. And in this Mastermind course, you'll learn how it works. 

Enjoy.

In today's Flow Show, Steve Strazza said: "Bull Markets give us options."

And he's right.

There is an embarrassment of opportunities right now. And he came to the show with a list of ideas that we reviewed. 

You can watch the full episode here:

There were two trades I wanted to put on that were discussed during the show.

Today, I'm choosing to enter the Gamestop $GME idea.

So here's the $GME chart:

Now, forget everything you ever learned in technical analysis school. And you can certainly throw your fundamental texts in the garbage. None of that will help you with this stock. It doesn't follow the rules or even logic and certainly not common sense.

This is and will likely forever be a story stock. A meme stock. Nothing else.

And right now, $GME is showing signs of waking up again. With options premium in out-of-the-money calls insane, it sets up a nice opportunity for us to leverage that premium to our advantage.

Here's the Play:

I like buying a $GME January 30/40 Bull Call Spread for approximately $1.35 net debit. This means I'll be long the Jan 30 calls and short...

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

1. New position in USO.
2. No adjustments are needed today.
3. No exits since the last report.
4. Current status of open campaigns.
5. Volatility Snapshot.

Let’s dig in!

This afternoon on Chart Request Live, my friend Patrick and I reviewed some of the standout tickers from the chat.

One group of stocks that really stood out was Digital Payments.

These stocks are on fire, offering favorable setups left and right these days, to the point I would be ashamed not to share some with you.

Before diving into some individual names, here's the Amplify Digital Payments ETF $IPAY:

IPAY just completed a textbook rounding bottom formation and is embarking on a new uptrend.

Aside from bellwethers like PayPal or Block $SQ (which I wrote about last week), there are three stocks that catch my attention within this ETF.

Welcome back to the Growth Chronicles.

Growth is the largest area of the market, and betting on these stocks has become one of the primary strategies for US investors. 

As such, the question of “which growth stocks” always lingers.

And these companies come in all different shapes and sizes.

For example, we all know about the mature, high-quality growth names like Nvidia, Meta, and Netflix…. Think Magnificent 7. The best stocks.

And then there are some real offensive, high-beta growth names. I’m talking about companies that are still pre-revenue, or just turning the corner in terms of profitability. 

I like to boil it down to two broad baskets… 

There is large-cap/quality growth.

And there is speculative growth.

So far, the current bull market has been dominated by the largest growth companies in the world. They have been the clear leaders. It hasn’t been close.

But that is finally changing.

As investors embrace increasing levels of risk, I think it’s time to shift the strategy. I...

Gold futures have been down in 6 out of the last 8 sessions since the winner of the U.S. Presidential Election was announced.

The US Dollar Index $DXY has been adding fuel to the selling pressure as it has screamed higher toward the upper bound of a multi-year range.

However, the dollar is entering one of its weakest seasonal periods of the year and should start serving as a tailwind for our shiny rocks.

And if the dollar is about to roll over, our equal-weight basket of precious metal stocks will likely resolve its multi-decade base and make new all-time highs:

Today's number is... 21

Our US dollar Advance-Decline line just closed at 21-year highs.

Here’s the chart:

(right-click and open image in new tab to zoom in)

Let's break down what it shows:

• The blue line in the top panel shows the price of the US dollar index.
• The black line in the bottom panel represents the US dollar Advance-Decline line, which is comprised of 23 key currency pairs.

The Takeaway: The US dollar has been ripping higher over the past month, and when we look beneath the surface, we see healthy breadth readings and confirmation of strength as our US dollar Advance-Decline line has reached its highest level in 21 years.

Typically, a strengthening US dollar would indicate that risk assets like stocks are facing challenges, given the broad intermarket implications of the US dollar. 

However, it appears that stock market bulls remain unfazed by the strengthening dollar. Perhaps a weaker dollar isn't essential for stocks to continue their rally - at...

I promise there is a trading lesson here. Stick with me...

Two-point lead. Ball on the opponent's 27-yard line. 4th and 2. Two minutes and 27 seconds left on the clock.

The choices are this:

1. Attempt to kick a make-able, but no gimme 44-yard field goal to go up by 5 points. 

2. Pooch punt to pin the opponents inside their 10-yard line for their next drive.

3. Call a play to attempt to gain the 2 yards needed to earn a fresh set of downs and continue running the clock.

Choose option 1 and there is a very real possibility that the Buffalo Bills' sometimes undependable field goal kicker could miss the 3-point try. This would leave the Kansas City Chiefs, and their future Hall of Fame Quarterback Patrick Mahomes with more than two minutes on the clock to move the ball less than 35 yards to put themselves into position to kick the game-winning field goal.

Even if the Bills' kicker makes the field goal, putting the Bills up by 5, there will still be more than two minutes on the play clock. For the team from Kansas City with countless late comeback wins, there is not a...

A nearly 3-year-long bearish-to-bullish reversal pattern has whetted my appetite for today's trade.

And a follow-through could deliver a nice dash for cash.

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

1. No new positions today.
2. Rolled XLI to January options.
3. Closed XRT at profit target.
4. Current status of open campaigns.
5. Volatility Snapshot.

Let’s dig in!

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...

The biggest insider move today comes from Paul J. Fribourg, a director at Estee Lauder Companies $EL, who purchased $10,045,534 worth of shares, as reported in a Form 4 filing.

The stock has dropped 82% from its all-time highs and is now trading at its lowest level in a decade.

This significant insider buy signals confidence in the company's potential recovery.

Here’s The Hot Corner, with data from November 15, 2024:

In another Form 4, director Alfred W. Zollar revealed a purchase of $203,970 in Nasdaq Inc $NDAQ.

We continue to witness insider activity in solar stocks. Today, we have data from the president and CEO of Enphase Energy $ENPH, who made a purchase of 5,000 shares.

Enphase has fallen 30% in the last two weeks, as solar stocks have collapsed following the election.

With the stock trading at its lowest level in more than four years...

Today's number is... 16

On Friday, we saw the S&P 500 closed down 1.3%. This marks the 16th time this year that the index has declined by 1% or more in a single day.

Here's the data:

(right-click and open image in new tab to zoom in)

Let's break down what it shows:

The first column represents the year, while each subsequent column indicates the number of large down days for that year, ranging by declines of 1%, 2%, and 3% or more and total count.

The Takeaway: Although experiencing 16 declines of 1% or more might seem significant, it is actually below the historical average. Since 1950, the average year typically experiences about 25 such declines. During 2024, most of the 16 days with a 1% or more market decline occurred amid a short-term market pullback.

On average, each year tends to have 3 to 4 pullbacks of 5% or more, and in 2024, we have only seen two pullbacks of this size.

Therefore, a similar-sized pullback at this point would be completely normal and wouldn’t be surprising at all.  ...

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.

Yesterday I talked about some areas that are struggling to hold onto their post-election gains. The list has grown following today's selloff.

One group that’s been unfazed by this week’s volatility is financials.

Today, let’s flip the script and focus on an industry showing serious resilience.

Banks have been one of the best-performing groups over the past week, positioning themselves as leaders in the current environment.

The S&P Banks ETF $KBE is on the verge of completing a textbook reversal pattern relative to the S&P 500.

The ratio is piercing through the upper ends of this base as we speak.

The 200-day moving average has been flat all year but is curling up, suggesting that the trend could be at the early stages of reversing.

In technical analysis kindergarten, you'll learn there are 3 asset classes: stocks, bonds, AND commodities.

Without all 3, you're missing a piece of the puzzle and are putting yourself at a disadvantage.

Since commodities peaked in absolute and relative terms in 2022, they have dramatically underperformed stocks.

It's gotten to the extent where there's not any momentum to the downside remaining.

Commodities have carved out a massive bullish momentum divergence relative to stocks since the start of 2024:

As you can see, DBC/SPY has made lower highs and lower lows all year while the 14-day RSI (momentum) has made higher highs and higher lows.

In addition, the ratio is at the same level it was when it bottomed in the prior cycle and began a multi-year uptrend. 

It's now or never. If the commodity bulls are going to reverse this downtrend versus stocks, they need to show up now.

The Invesco Commodity Index $DBC has carved out a textbook basing pattern:

The Invesco Commodity Index is composed of over 55% energy, 10%...