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...

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 September 27, 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...

When it comes to our short-squeeze universe, the best trades tend to come from the junkiest stocks. 

In late 2022, we went dumpster diving for the most beat-up and heavily shorted stocks in the market and had some big winners. We were at the depths of the bear cycle, and the charts looked terrible. They were supposed to be zeros, but they weren't.

Just look at how Carvana $CVNA has performed since we were buying it at 8.25 almost 2-years ago.

Another junky group that has been working recently is the Marine Shipper industry.

Our custom Marine Shipping Index is on the verge of reclaiming the 61.8% retracement of its prior drawdown:

The unfortunate thing about most shippers is that they have little short interest.

But they trade like they do...

These stocks can rally several hundred percent in a short amount of time when they trend.

Even better, we're outlining a trade for one of the best-performing Marine Shippers and this one does have a massive short interest. We think this trade could be a multi-bagger.

...

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.

Have you heard about China?

Chinese stocks just had their best week in history, following the People's Bank of China's (PBOC) announcement of rate cuts, among other stimulative actions.

In July, we talked about Copper and its base and industrial metal peers showing broad weakness. But that seems to be changing...

China is the world's largest consumer of refined copper, so base and industrial metals have benefited from the recent pivot from the PBOC.

Chinese stocks and copper futures have been positively correlated for years:

The 200-day rolling correlation flipped negative earlier this year but is positive again and has recently been screaming higher toward its highest positive correlation in history.

This week, the China Large-Cap ETF $FXI decisively broke a multi-year downtrend line and entered a new primary uptrend.

If the path of least resistance is higher for Chinese stocks, the 29th element should also catch a bid.

Earlier this year, Gold broke out to new all-time highs, but Copper...

Despite the gloomy headlines the market received this summer, major stock market sectors are showing resilience across the board, with new signs of life emerging. 

A shift seems to be on the horizon.

At the moment, we are long bonds. We like bonds, and the charts tell us we are right to like bonds here, but what does the future hold?

If inflation starts ticking up again, the market usually pivots toward the reflation trade—favoring sectors like energy, small caps, and financials as rates rise. (I am not saying that this is happening. I am saying that we need to keep an eye on this.) 

Energy has not participated in the bull run this year. When we compare XLE to some of the best stocks this cycle, like XLK, the performance gap is wild.

The chart below shows XLK up roughly 40% over the trailing 12 months while XLE is negative.

Meanwhile, the rally in bonds appears to be slowing down. 

Bonds have a traditionally inverse relationship with energy stocks, so we think this further sets the stage for a catch-up trade from oil and gas.

Oil...

From the desk of Steve Strazza @Sstrazza

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...

From the Desk of Steve Strazza @Sstrazza

Welcome to The Junior International Hall of Famers.

With the goal of finding more bullish setups, we have decided to expand one of our favorite scans and broaden our regular coverage of the largest US-listed international stocks, or ADRs.

This scan is composed of the next 100 largest stocks by market cap, those that come after the top 100 and are thus covered by the International Hall of Famers universe.

Many of these names will someday graduate and join our original International Hall Of Famers list. The idea here is to catch these big trends as early on as possible.

Let’s dive right in and check out what these future big boys are up to.

This is our Junior International Hall of Famers list:

Click table to enlarge view

And here’s how we arrived at it…

We removed laggards which are down 5% or more relative to the ACWI Ex. U.S. Index $ACWX over the trailing month.

Then we sorted...

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...

The dollar is weaker than you think. 

This is a major development in the forex market. And when we look under the hood, things are even worse than they appear for the greenback.

With more and more global currencies showing relative strength each day, it’s time to take a look at US dollar internals and see what’s moving. 

Relative strength is not just the cheat code for stocks, it also works for the currency market and everything else in between. 

We also learn a lot about the breadth of a given market through analyzing internals. This helps us determine how we want to position ourselves to make money. 

And right now, it looks like we should position ourselves for a lower dollar over longer time frames. 

The following table shows the US dollar is in, or moving toward, a bearish trend regime against most other major currencies.

As you can see, over 60% of currencies are in uptrends against the dollar… and this is now true on every timeframe we analyze. 

This is...

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 highs in order to focus...

The Best Morning Show in Finance is BACK!

After a week long hiatus at the FutureProof Conference in California, and then our ...