From the desk of Louis Sykes @haumicharts

It's been almost a joke at this point to cover Bitcoin from an analytical perspective when it's been nothing but representative of the Nasdaq, US growth stocks, and long-duration assets in recent months.

People often ask what it'll take for correlation to macro to die out.

Here's a take.

Bitcoin has its whole separate supply dynamics taking place on-chain away from macro.

The reality of the situation is that there's a small group of highly sophisticated traders utilizing perps and the traditional calendar futures market in great size bounding price action to the US indices. But under the surface, there's a new group of investors and a cohort of preexisting ones that are laying down support.

Zhu Su of 3AC likens it to a supply "gentrification" to convicted crypto natives, institutional buyers, and HNW individuals, that when complete will see a significant dislocation between equity markets and Bitcoin. The price action of the last week is an extreme example of this transfer.

Another take I like is from BitMEX'...

From the desk of Louis Sykes @haumicharts

We start the week as markets look to stabilize from yet more volatility. Supply dynamics show the dust is beginning to settle from the Luna collapse, as traders absorb and process the events of the last week.

Since the writing of our last letter, Bitcoin briefly dipped below 30,000, reaching an intraday low of around 25,000.

The market is in a state of panic, with the highest losses being realized since the Covid crash.

With the LFG capitulating their Bitcoin arsenal and Bitcoin still hanging around 30,000, it's got us asking, "was that it?"

 

 

From the desk of Steve Strazza @Sstrazza

Our Top 10 Charts 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.

S&P 500 Tests a Key Level

Equities continue to look vulnerable as sellers remain in full control. When it comes to the major averages, we’ve had our eyes on the AVWAP from the COVID lows. In late April, the Russell 2000 and Nasdaq 100 violated these levels and followed it up with a fresh leg to the downside. Markets have continued to sell off since. 

Today, all eyes are on the S&P 500 which is now challenging its AVWAP from the COVID lows. This level represents the price the average investor has paid since March 2020, making it a critical level of interest.

What this really means is the average buyer since that time is now in a loss position. While this would be a logical place for bulls to step in and stop the carnage, we’re not seeing any sign of it yet. Until we do, be prepared for heightened volatility and further downside.

...

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 big picture context 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.

Macro Universe:

• Our macro universe was red again this week as 81% of our list closed lower with a median return of -1.87%.
• 20+ Year Treasuries $TLT were the winners this week, closing with a 2.03% gain.
• The biggest loser was Lumber $LB, with a weekly loss of -8.01%.
• There was no change in the percentage of assets on our list within 5% of their 52-week highs – currently at 11%.
• Only 4% of our macro list made fresh 4-week highs....

From the desk of Willie Delwiche.

Key Takeaway:

• Friday’s rally needs follow-through to change the environment.
• Narrow strength and broad weakness producing more new lows than new highs.
• Yields pull back, but stress is building.

After Friday’s bounce, the Value Line Geometric index is at the same level that it was to begin 2021, which is also where it was to begin 2018. For those so inclined, it hasn’t been so much a buy-and-hold environment as it has a buy-and-hold-on-tight environment. While there have been pockets of strength along the way, they have not persisted. The challenge for the indexes right now is that the sectors that are seeing the best strength are relative lightweights. Between 60% to 80% of stocks in the Consumer Staples, Utilities and Energy sectors are trading above their 200-day averages (for the S&P 1500...

It's no secret that markets are dicey.  We're not revealing anything surprising here.

When markets are all over the place, it's good to have diversity -- not just diversity in instruments traded, but diversity in direction and strategy.

With this in mind, we're going to add another bearish position to our portfolio to help offer some balance to some of our long energy names.

 

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

The largest insider transaction on today's list is a Form 4 filing by George Lopez, founder and former CEO at ICU Medical $ICUI, who reported a $4 million purchase of his own stock.

We had two different insiders report purchases in the battered Bitcoin proxy MicroStrategy $MSTR.

Not much has changed in terms of the market trend. What we're observing keenly is if support levels hold in the short-term scenario. There are bouts of strength coming through in certain sectors and today's stock comes from the FMCG sector.

Do you know what we're talking about?

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.

Welcome to Paid to Play -- a unique window into a live trading account we manage for the express purposes of generating cash flow and adding diversification to our portfolio of trading strategies.

There are specific questions we seem to get regularly, so I thought I'd compile this FAQ ("frequently asked questions") doc to serve as an ongoing resource to all P2P subscribers.

In no particular order:

Over the years investors have come up with new and creative ways to lose money in the market.

But Silver just keeps helping investors do it the old fashioned way:

As you can see, Silver is down and making new 52-week lows.

And this brings up a bigger question.

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.

The market is not a children's book.

I know sometimes we all kind of wish it was.

But it's not.

As investors, we can approach the market pretending it's one way, or we can approach it knowing it's the other.

That's up to you.

For us, we never even think about who is on the other side of our trades.

Why would we?

But it's something that's come up recently and probably worth addressing.

These are the registration details for our live mid-month conference call for Premium Members of All Star Charts.

Our next Live Call will be held on Thursday May 19th at 6PM ET. As always, if you cannot make the call live, the video and slides will be archived and published here along with every other live call since 2015.

Here are the details for Thursday night:

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.

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

There’s always a bull market somewhere.

But the environment is tough right now.

Volatility is sweeping across markets. The dollar is catching a defensive bid. And the major averages continue their downward trajectory as investors desperately look for signs of a bottom. 

Yet, despite the bearish action gripping markets, we’re still finding bases we want to buy.

And, to no surprise, many of those smiley faces are in the commodities market.

That’s where we want to focus our attention.

Today, we'll highlight the wheat complex, outlining some tactical setups that complement our bullish structural outlook for commodities and grains.

Let’s dive in!

First up, we have Chicago wheat:

Earlier in the spring, this contract skyrocketed to new all-time highs. It’s since corrected, forming...

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 around the world.

Here’s this week’s list:

...

From the desk of Willie Delwiche.

The preliminary May reading for the Consumer Sentiment Index (published by the University of Michigan) dropped to one of its lowest levels on record. The Expectations component is still above its March low, while the view of Current Conditions is at new cycle low - and at its lowest level since late 2008. That’s right - things are seen as worse now than they were at the worst of the COVID-related shutdowns. At one level this seems ludicrous - the S&P 500 is just a few months removed from record highs and pretty much anyone who wants a job can get one. On the other hand, everyone is seeing surging prices at the grocery store and gas station. They see surging balances on their credit card statements, but collapsing balances on their brokerage statements. This an unfamiliar environment for an entire generation of investors who have never experienced a double-digit year-over-year drawdown in the NASDAQ 100. It’s particularly acute for investors who listened to the advice of “experts” and have bought every dip this year. We don’t need to look at this incredulously and suggest things aren’t actually as bad as they have been in...

Ok, so the market is bouncing and its offering a nice reprieve to those who've been caught on the wrong side of the recent slide. Does this mean the bottom is in?

It's far too early to tell. And that's not the bet we're making just yet. In fact, today's trade is to take advantage of a nice bounce in a name we're bearish in to position for a retest of recent lows.

So let's get right to it.

 

This is the video recording of our May 13, 2022, All Star Charts Crypto Weekly Strategy Session.