From the desk of Steve Strazza @sstrazza

This is one of our favorite bottoms-up scans: Follow The Flow. In this note, we simply create a universe of stocks that experienced the most unusual options activity -- either bullish or bearish... but NOT both.

We utilize options experts, both internally and through our partnership with The TradeXchange. Then, we dig through the level 2 details and do all the work upfront for our clients. Our goal is to isolate only those options market splashes that represent levered and high-conviction, directional bets.

We also weed out hedging activity and ensure there are no offsetting trades that either neutralize or cap the risk on these unusual options trades. What remains is a list of stocks that large financial institutions are putting big money behind... and they're doing so for one reason only: Because they think the stock is about to move in their direction and make them a pretty penny.

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

The US Dollar trading at key levels against a significant amount of Developed and Emerging Market currencies is the major theme in Currency Markets right now. 

The GBP/USD is challenging an area of resistance that acted as support for over two decades but has been a barrier for prices since the Brexit vote almost 5 years ago.

The USD/CHF is on the verge of completing a massive 9-year top.

The USD/ZAR just violated critical support at a decade-long trend line.

And USD/CAD is currently attempting to complete a 5-year double top... with a pattern that looks strikingly similar to that of the DXY Index itself.

From the desk of Steve Strazza @Sstrazza.

Welcome back to our latest "Under The Hood” column for the week ended June 13, 2021. This report is published bi-weekly and rotated on-and-off with our "Minor Leaguers" column.

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.

It's Saturday Morning Chartoons time. You can read more about the reasoning behind this post here. 

We're just interested in aggregating all of the charts we put together throughout the week and organizing them all into one, easy to flip through deck.

One thing that stood out to me this week is the lack of deterioration underneath the surface.

We're just not getting an expansion in new lows.

Fewer new highs? Yes definitely. For a while now.

But more new lows? 

Not broadly speaking yet, no.

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

Softs are an area of the commodity space that hasn’t received much attention over the past several months, and for good reason.

As the rest of the commodities complex has been on fire, the action from this group has been muted as they’ve underperformed their peers significantly since last year.

Besides Sugar reaching our initial objective last month and Coffee breaking out of a 4-year bottom, Softs have been a real snooze fest.

Cotton continues to chop within a broad range. Cocoa is well below overhead supply. And OJ grinds sideways as it builds a 3-year base.

But it looks like Orange Juice futures are poised to break free to the upside.

Let’s take a closer look at this favorable risk/reward opportunity in OJ and lay out a potential trade setup to get long this base breakout, if and when it comes...

Here’s the weekly chart of Orange Juice futures:

From the desk of Steve Strazza @Sstrazza

Dividend aristocrats are easily some of the most desirable investments on Wall Street. These are the names that have increased dividends for at least 25 years, providing steadily increasing income to long-term-minded shareholders.

As you can imagine, the companies making up this prestigious list are some of the most recognizable brands in the world. Coca-Cola, Walmart, and Johnson & Johnson are just a few of the household names making the cut.

Here at All Star Charts, we like to stay ahead of the curve. That’s why we’re turning our attention to the future aristocrats. In an effort to seek out the next generation of the cream-of-the-crop dividend plays, we’re curating a list of stocks that have raised their payouts every year for 5-9 years.   

We call them the Young Aristocrats, and the idea is that these are “stocks that pay you to make money”. Imagine if years of consistent dividend growth and high momentum & relative strength had a baby, leaving you with the best of the emerging dividend giants that are outperforming the averages.

Have you seen Homebuilding stocks getting hit?

It's not happening at a random spot either. The upside objectives were hit, as we discussed on last week's call, so this would be a perfectly logical place for this correction to take place.

But the chart of the week has to be Homies relative to REITs. With Real Estate Investment Trusts (REITs) breaking out on both an absolute AND relative basis, it makes this chart that much more dramatic.

This is the true story:

From the desk of Steve Strazza @Sstrazza

Welcome to the 2 to 100 Club.

Something we’ve been working on internally is using various 'bottoms-up' tools and scans to complement our top-down approach.

One way we’re doing this is by identifying the strongest growth stocks as they climb the market-cap ladder from small, to mid, to large - and ultimately 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.

From the desk of Steve Strazza @sstrazza

Welcome to our latest RPP Report, where we publish return tables for a variety of different asset classes and categories along with commentary on each.

Looking at the past helps put the future into context. In this post, we review the absolute and relative trends at play and preview some of the things we’re watching to profit in the weeks and months ahead.

We consider this our weekly state of the union address as we break down and reiterate both our tactical and structural outlook on various asset classes and discuss the most important themes and developments currently playing out in markets all around the world.

Seems there has been a lot of talk about the stock market "pausing" or being "due for a correction."

While I see the same things the bears are seeing, I'm also seeing price action in a variety of corners of the market still telling a bullish story. And as we like to say around here: "Only Price Pays" (h/t @alphatrends).

We're also seeing bullish options flow from several "motivated" and "aggressive" traders in a variety of names. Case in point: a software storage name in our most recent Follow the Flow report caught my attention.

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

A couple of weeks ago, we posed this question in a post titled "Can the Dollar best the BRICS?"

Back then, we were already leaning toward "NO." Fast forward to today, and it's more like a "NO WAY."

The reason for this is simple. In that post, we explained the line in the sand for our USD/BRICS Index was ~19.

In the few weeks since, this critical level has been violated. The market has spoken, and it's saying we're in for a lower US Dollar relative to BRIC-country currencies.

For you visual learners... This is what the chart looked like back then, and here is what it looks like now. Quite the difference, right?

From the desk of Willie Delwiche.