From the desk of Willie Delwiche.

Key takeaway: Despite the decreasing exposure of active equity managers, the weight of the evidence continues to lean toward a neutral sentiment backdrop that supports a much needed reset, allowing optimism to rebuild moving forward. Investment managers may be pulling back from the market, but equity ETF inflows have reached record levels. This past month inflows reached over $80 billion, the highest level over a one month period. This may suggest excessive investor positioning but inflows can remain high for extended periods of time before negatively impacting the market. Another piece of information that points to growing optimism is The Consensus Inc. Bullish Sentiment Index as it reached 74% last week, it’s highest level since early 2018. These pockets of investor optimism, within the broader neutral setting, allude to the nature of the recent unwind.

Sentiment Chart of the Week: Economic Activity and Risk Appetite

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Two weeks back we had noticed IT putting its head again from underground and shared some actionable ideas. As the market progresses, we're noticing new names joining this list and thought it would be nice to have a follow-up post for the same.

Let's see what these stocks are indicating for the weeks and months ahead.

HCL Tech has now joined the other stocks in this sector as it attempts to move past its overhead supply zone of 1,024. Retreating from the same level twice in the recent past, we might see a follow-through this time around as the tailwinds favouring IT could favour this particular stock as well. The indicator is attempting to move back into the strong zone.

We are bullish above the level of 1,024 with a target near 1,425.

Click on chart to enlarge view.

From the desk of Willie Delwiche & Ian Culley. 

Key Takeaway: The overall market continues to digest gains within a larger structural advance. Market sectors that relate to tangible goods push to new highs. Traditional safe-haven assets fail to ensure safety.

Financial, Energy, Industrial, and Material sectors continue their reign in our relative strength rankings, while mid-cap groups narrowly surpassed small-caps to command the top-tier of our industry group rankings. Though more defensive sectors continue to have the best relative strength on a short-term basis, Technology and Consumer Discretionary are starting to pick up in the near term as well. Small-cap deterioration persists at the industry group level, whereas large and mid-caps improve.     

From the desk of Steve Strazza @Sstrazza and Ian Culley @IanCulley.

We held our April Monthly Strategy Session Thursday night which Premium Members can access and rewatch here.

For these calls, we really take a step back and put things in the context of their structural trends by focusing only on Monthly charts. This is easily one of our most valuable exercises.

In this post, we’ll provide a summary of the call by highlighting three of the most important charts and topics we covered along with commentary on each.

Let’s dive into it.

From the desk of Steve Strazza @Sstrazza.

Welcome back to our “latest Under The Hood” column for the week ended April 2, 2021. As a reminder, this column will be published bi-weekly moving forward, and rotated on-and-off with our new Minor Leaguers column.

In this column, we 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.

Whether we’re measuring increasing interest based on large institutional purchases, unusual options activity, or simply our proprietary lists of trending tickers… there is a lot of overlap.

The bottom line is there are a million ways to skin this cat. Relying on our entire arsenal...

Signals act as indicators for what's to come or what we can expect. If you look closely, there are several signals that can be picked up from the market in order to stay ahead of the curve. A lot of analysis goes into arriving at the bottom of the funnel that is stock selection.

While the bigger trends are in place and their relative analysis helps us understand their strength and weaknesses, there are certain signals that can be picked up on a regular trading day as well.

Once again this month, I'm going to share info on positions that were closed in the month of March. As a reminder, our exit plans are always laid out ahead of time in each trade idea we publish. In every case, the exits mentioned below were all exited in accordance with the plan as laid out.

From the desk of Steve Strazza & Grant Hawkridge

Don't miss this weeks Momentum Report; our weekly summation of all the major indexes at a Macro, International, Sector and Industry Group level. As a reminder, we analyze this shorter-term data within the context of the structural trends at play.

This week we're looking at a long setup in the Metal sector. Several stocks in this sector are performing well with our Outperformers scan throwing up another popular name last week.

We retired our "Five Bull Market Barometers" in mid-July 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.

One of the things that stood out to me this quarter was most certainly the performance of Value Stocks over their Growth counterparts.

Take a look at the difference in Q1:

The big news to end of the week is Ethereum completing this monster base and breaking out to new all-time highs.

For me, I don't care if we're talking about Crude Oil Futures, Apple or Tesla shares, Treasury Bond ETFs, Gold, Silver, Crypto....

It doesn't matter to me. It's just letters and math. All that other stuff isn't my problem.

The trade has been to be long ETHUSD if we're above those former highs from 2018. It was that simple. The risk was very well-defined and the potential reward was exponentially greater. That's what we look for. And so far, that strategy has worked well for us.

But now, while stocks are on holiday, Ethereum is really making a go of it:

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

Many of the same themes that we came across in last week's Commodity Report continue to play out.

Overhead supply keeps demand at bay while price churns sideways, offering mixed signals.

Like many areas of the market, Commodities are a bit messy.

While sideways price action and choppy market conditions are the norms at the moment, there is one consolidation in the Commodity space that demands our close attention.

As JC pointed out in last night's Monthly Strategy Session, one of the most important charts right now is the Copper/Gold ratio as its intermarket implications span far and wide.

As the...

From the desk of Willie Delwiche.

Many financial assets made new highs in the first quarter. Gold and bonds did not. The drawdown they have experienced since their August highs has been remarkable - eclipsing 20% in the case of bonds, and approaching that level in the case of gold. In the Wall Street Journal’s list of Q1 winners and losers, long-term US bonds came in dead last (with a quarterly decline of 14%). For many conservative investors, this is their safe money and, especially for bonds, thought to be risk-free. The behavioral response to this will be interesting to track and may put further pressure on outdated passive portfolio management approaches.

Early in February, we had published a post discussing the Adani Group and its targets as well as risk management levels.

Seeing as this particular solar system is completing rotations and revolutions rather quickly, we thought it would be a good idea to revisit these stocks and track the updated levels for the weeks and months ahead.

Our equally weighted custom Adani Group Index has shown no sign of slowing down. The bullish trend is strongly in place and seems well on its way to the next higher level.

Click on chart to enlarge view.

Now let’s take a look at individual stocks and where they stand at present.

The weekend is when we open all our chartbooks and go through every chart in order to update or follow trends and sentiments as they build over the week. But sometimes, a few names pop up even before we hit the weekend research start button.

Today we will discuss two such names that seem to be displaying resilience in the market over the past couple of weeks.

This is the video recording of our April 1, 2021 Monthly Charts Live Strategy Session

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

I think we can all agree that the market is an absolute hot mess right now.

The Precious Metals complex is as good an example of this as any right now.

In this post, we’ll use this shiny group of commodities as a case study to illustrate the mixed signals we see not just here but in asset classes all over the globe these days. 

It’s a major development, to say the least - so we’d be irresponsible not to monitor it closely as the way things resolve from here will likely have implications that span across markets, far and wide. 

We’ll also provide an update of our post from earlier in the month whereby we outlined a trade idea in Gold Miners.

This is the video recording of the April 1st Town Hall Meeting w/ Willie Delwiche & JC Parets

04/1/21 2PM ET