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

As US Dollar strength unfolds and US treasuries continue to catch a bid, it’s no wonder our motto around here has been bonds, cash, champagne.

It’s been working, and it continues to work!

We’ve been downright obnoxious about our tactical view of the US Dollar over the past month.

A potential bounce was developing, strength emerged, and we pointed out numerous crosses in which the dollar was poised for a push higher.

The market environment directed our focal point toward the Dollar. And now that it appears risk is coming off the table, we’re shifting our focus to the Yen.

Usually, when we talk about risk-on/risk-off behavior and the Yen, the AUD/JPY is at the center.

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

Welcome to our latest "Minor Leaguers" report.

We've already had some great trades come out of this small cap-focused column since we launched it late last year and started rotating it with our flagship bottoms-up scan, "Under The Hood."

To make the cut for our Minor Leagues list, a company must have a market cap between $1 and $2B. There are also price and liquidity filters. Then, we simply sort by proximity to new highs in order to focus on the best players only.

From the desk of Steve Strazza @Sstrazza

Check out this week’s Momentum Report, our weekly summation of all the major indexes at a Macro, International, Sector, and Industry Group level.

By analyzing the short-term data in these reports, we get a more tactical view of the current state of markets. This information then helps us put near-term developments into the context of the big picture and provides insights regarding the structural trends at play.

Let’s jump right into it with some of the major takeaways from this week’s report:

* ASC Plus Members can access the Momentum Report by clicking the link at the bottom of this post.

From the desk of Steve Strazza @Sstrazza

Our Top 10 report was just published. In this weekly note, we highlight 10 of the most important charts or themes we're currently seeing in asset classes around the world.

Base Metals Bury The Hatchet

Dr. Copper often steals the spotlight when it comes to base metals, and for good reason. It’s one of the most economically sensitive commodities. More importantly, it holds a special place in our collective psyche, as one of the major assets that investors turn to in order to gauge the state of the economy, and even investor risk appetite. With that said, the current correction in Copper has raised some concern, especially given the choppy market conditions.

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

June is officially in the books!

Now, it’s time to dig into a fresh batch of monthly candles…

As everyone prepares to celebrate over the long weekend, we’re pouring over our monthly charts to reconnect with the primary trend.

And we witnessed some key developments in the commodity markets in June that are hard to ignore:

• Lumber was down almost 45%
• Copper was down 8%
• Natural Gas was up 24%
• Crude Oil was up 10%

Tumbling lumber futures and copper’s failure to hold above its former 2011 highs raised caution for risk assets.

From the desk of Steve Strazza @Sstrazza

When running through some scans this morning, we came across a stock that's been on our radar from the Under the Hood universe.

You can read our most recent report here. It was just published Monday.

This is a quick follow-up to discuss a hot stock from a leading industry group... And of course, it's presently offering us a skewed risk/reward. At the end of the day, that's all we're really looking for!

On the surface, this company is just an old LED light and radio-frequency device maker...

But, that's not the whole story.

They actually manufacture and sell some of the most important inputs and materials for a variety of burgeoning growth industries.

While a seemingly favorable fundamental story is always nice to have as a potential catalyst, it is never enough. For us, it's all about price.

Speaking of which, let's dive in and see what the charts are telling us.

From the desk of Steven Strazza @Sstrazza and Grant Hawkridge @granthawkridge

Check out our latest Mystery Chart!

What we do here is take a chart that’s captured our attention, and remove the x and y-axes as well as any other labels that could help identify it.

This chart can be of any security, in any asset class, on any timeframe. Sometimes it’s an absolute price chart, other times it’s on a relative basis.

It might be a ratio, a custom index, or maybe the price is inverted. It could be all three!

The point is, when we aren’t able to recognize what’s in front of us, we put aside any biases we may have and scrutinize the price behavior objectively.

While you can try to guess the chart, the point is to make a decision…

So, let us know what it is… Buy, Sell, or Do Nothing?

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

We’ve been pounding the table about the broad-based strength from the US Dollar since earlier this month. Due to the momentum of its recent move, we believe this rally could have legs beyond just the near-term... But we'll address that when the time comes.

For now, we're positioned to take advantage of this swift rebound from the Dollar through a handful of USD crosses currently offering favorable risk/rewards. 

Though the Dollar gave some of this month's gains back last week, our short-term outlook remains higher. As I write this, many G-10 currencies like the Euro, Pound, Aussie, and Canadian Dollar are all rolling over relative to USD. 

We’ll be revisiting this theme plenty as it plays out over the coming weeks to months.

But in the meantime let’s focus on a currency pair that’s bucking the trend, the US Dollar-Brazilian Real $USD/$BRL.

Here’s a weekly bar chart of USD/BRL:

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.

We've been pretty obnoxious about our position that markets are a total mess these days. But it is what it is, and we can only play the hand we're dealt. 

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.

Welcome back to our latest "Under The Hood” column for the week ended June 27, 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.