From the Desk of Steve Strazza @Sstrazza

When investing in the stock market, we always want to approach it as "a market of stocks."

Regardless of the environment, there are always stocks showing leadership and trending higher.

We may have to look harder to identify them depending on current market conditions. But there are always stocks that are going up.

The same can be said for weak stocks. Regardless of the environment, there are always stocks that are going down, too. 

We already have multiple scans focusing on stocks making all-time highs, such as Hall of Famers, Minor Leaguers, and the 2 to 100 Club.

We filter these universes for stocks that are exhibiting the best momentum and relative strength characteristics. 

Clearly, we spend a lot of time identifying and writing about leading stocks every week, via multiple reports.

Now, we're also highlighting lagging stocks on a recurring basis.

Welcome to the Short Report.

We...

From the desk of Willie Delwiche.

Key Takeaway: In recent weeks, the bulls have made their presence known after hiding in the shadows for most of the year. But as they inch their way forward, they will need assurance from the market that they’re moving in the right direction. So far, any signs of positive feedback have been lacking. New lows remain greater than new highs (for 35 weeks and counting). And there is an absence of strength among global markets, although they have stopped going down. The market needs to turn it up in regards to price and participation if the bulls are to prove more than a bunch of wallflowers.

Sentiment Report Chart of the Week: How Do We Keep The Bulls On Dance Floor?

If we are going to have a party, we need to keep bulls on the dance floor. One way to do that is through improved price action. We know that it takes bulls to have a bull market, but it also takes a bull market to keep the bulls involved. When we look across various assets, we keep coming back to key levels...

This is the video recording of our July 27, 2022, Inside Scoop Weekly Strategy Session.

From the Desk of Louis Sykes @haumicharts

There's no denying the fact that it's been a rough time being a crypto investor lately.

From our work, crypto market participants are closely approaching their maximum pain thresholds.

In real terms, losses realized on-chain reached their highest values going back to 2011. In nominal terms, Bitcoin holders realized the most amount of losses in USD terms in crypto's entire history.

We've gone from 95% of all market participants holding unrealized profits to a measly 50% in the space of a few short quarters.

This is, by most measures, one of the most severe bear markets by loss realization, capital leaving the ecosystem, and contagion among even the largest and most sophisticated of players.

Despite this destruction of wealth, it's important to be grateful for our losses.

We had a resting GTC order filled at our profit target in the Paid-to-Play portfolio today:

We had a resting GTC order filled at our profit target in the Paid-to-Play portfolio today:

The next new trade in our Paid-to-Play portfolio is:

Elliott Management, one of the largest and longest-tenured activist funds on Wall Street, is back on our list with its second big splash in two weeks.

Earlier this month, Elliott Management became the largest shareholder in Pinterest $PINS with a roughly 9% stake.

From the Desk of Ian Culley @IanCulley

Anyone can enter a trade. It’s easy. 

But before you step up to the line to place your bet, you must have a plan – a set of rules rooted in risk management to guide you through your trade.

There’s no way to enter and manage a trade if you don’t know where you’re right, where you’re wrong, and where you’re taking profits. Without a plan, your strategy and philosophical approach to the markets don’t matter. 

That brings us to the British pound.

Here’s a chart of the GBP/USD cross:

A few weeks ago, we outlined a short setup in the GBP/USD pair. The pound was breaking down to levels associated with the Brexit sell-off, and we wanted to ride that trend lower.

Around the same time, the EUR/USD reached parity, as the US Dollar Index $DXY hit its highest level since November 2002. "Long dollar, short everything else" was the trade.  

But now that the GBP/USD is back above our risk level around 1.2025, we can’t...

From the desk of Willie Delwiche.

It’s been over a month since the S&P 500 made a new year-to-date low and market volatility has cooled somewhat. After averaging a 1% move (in either direction) every other day in the first half of the year, the S&P 500 has only had 5 such moves so far in July (16 trading days). The last one was over a week ago.

A couple 9-to-1 up volume days on the NYSE and an uptick in bulls on the sentiment surveys is providing some hope that the bear market environment may be fading. Our Risk Indicators (as well as the continued presence of more stocks making new lows than new highs) argue that it is premature to jump to that conclusion. 

We have seen some improvement over the past month, and of the 20 risk off - risk on asset pairs, 14 are closer to their risk-on extreme than they were a month ago. But even with that improvement, only 3 of the pairs are closer to the risk-extreme than the risk-off extreme. In this fight over field position team “Risk Off” is winning. As we get into the details, this story is more about a lack of risk appetite and risk on weakness rather than broad...

We had a resting GTC order filled at our profit target in the Paid-to-Play portfolio today:

The next new trade in our Paid-to-Play portfolio is:

From the desk of Louis Sykes @haumicharts

And, just like that, any residual strength in crypto has once again dwindled.

Guys, we like to keep it honest and real with you.

At a certain point, we feel obnoxious about being so repetitive. But we're not going to tell you anything other than what's happening -- it's just our job as technicians to follow the money flow.

In yesterday's note, we outlined how we were taking a small, low-conviction long if Bitcoin $BTC was above 22,000. Just one day after we put the position on, Bitcoin's fallen back into its range:

A funny thing happened this Spring.

Inflation expectations peaked. Our equally-weighted Commodities Index peaked. And then the Copper/Gold ratio collapsed.

All of these point to lower Interest Rates.

And so here we are with the US 10yr Yield struggling with those 2018 highs.

The largest insider transaction on today’s list is a Form 4 filing by Director Lorence H. Kim, who reported a purchase of roughly $1 million in Revolution Medicines $RVMD.

We have a new sector that's making a new all-time high! Nifty FMCG is successfully putting in higher highs and higher lows. And today we're here to discuss a long idea from FMCG.

We retired our "Five Bull Market Barometers" in 2020 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.

From the desk of Steve Strazza @Sstrazza.

Welcome to the latest edition of Under the Hood, where we'll cover all the action for the week ended July 22, 2022. We publish this report bi-weekly and rotate it 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.

Watch this video for a behind-the-scenes look at our process.

Whether we’re measuring increasing interest based on large institutional purchases, unusual...

From the desk of Steve Strazza @sstrazza

This is one of our favorite bottom-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...