My gut tells me the odds of a pullback in the markets are increasing. And the next pullback in the direction back to recent lows will likely come with a lot of noise. There will be lots of shouts about "retesting lows," from some camps, and other shouts of "this was just a dead cat bounce, we're going much lower!" from other camps.

I have a hunch of how that plays out, which I discussed on this morning's Options Jam Session.

But if the market gets slippery here, and especially if the shouting class gets it right, I think housing sector stocks are vulnerable.

Macke portfolio holding Peloton reports in the morning. Officially the Street is looking for a loss of 6c on ~$650mm for the quarter and about $2.5b in revenue for the year, cranking out about $300 to $350 million EBITDA.

But that's not what I'll be watching. I'm grading the company on Churn, Cuts and Cashflow. I don't really care if Peloton is selling a lot of bikes. The head of marketing got fired last week so I suspect they aren't. Bikes and Treads and rowing machines crank out 1/3 of Peloton's revenues but it's only a 13.5% gross margin business. With Tariffs that margins falls to nothing-ish. Peloton runs inventory lean and has China exposure so there could be headlines related to moving product around ahead of the tariffs. Under old management that would be scary. The new team seems quite competent. Both me and the Street will forgive a little inventory kerfuffle.

If Peloton can't get more apparel and decides to close its pointless stores I'll be almost giddy.

So the tariff doesn't scare me.

Investors need to see churn (the number of people who quit) stay low (under 2%). This is a hard time of the year for churn but that's the key to Peloton as an...

Not yet a paid subscriber to Herb on the Street and my Red Flag Alerts? Join the growing club, now in the hundreds, who want to avoid the biggest mistake investors make… or just want to understand the concept of risk. You can find out more and how to subscribe right here. If you would prefer to pay with soft dollars, or participate in an upper tier, please contact me directly.

After watching a few Red Flag Alerts Focus List stocks rip yesterday, I posted on social media...

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...

In today’s Daily Digest, we’ll review the following:

1. No new positions today.
2. Adjustment to XLC position.
3. Closed IBB at Profit Target.
4. Current status of open campaigns.
5. Volatility Snapshot.

Let’s dig in!

Uber is is pulling back premarket, ostensibly on slightly light revenues and solid but not spectacular guide. At least that's going to be the reason analysts will cite for not taking up their ratings on Uber, despite the company crushing on trailing numbers and guiding to just a whisper better than estimates for the current quarter. 

The truth is both more nuanced and quite simple.

1. ) UBER shares are up 42% since April 6th. As discussed on Monday, Uber needed gargantuan numbers across the board. In this economy? Was never going to happen. The stock needed a little rest. We'll see how fast buyers come in:

Yesterday's Pre-Chart:

2.) This wasn't a quarter that was going to change anyone's mind. Uber didn't post terrible news as the stock fell from $80 to $60 earlier this year. It just got dragged down the rest of the flotsam, with a bunch of misunderstood news about autonomous vehicles thrown in on top of it.

Now that Uber has reported huge earnings and cash flow analysts with a bearish take will go back to mumbling about unsustainability and the ever-looming threat of Tesla releasing a fleet of cabs.

At least that's what I suspect...

Palantir $PLTR just delivered a double beat, with both revenue and earnings exceeding expectations. 

But you wouldn’t know it from the chart.

Despite the solid headline numbers, the stock suffered its worst earnings reaction in over a year.

This is the kind of tape where good news isn’t good enough. 

When a high-profile name like Palantir delivers and still gets sold, it tells you all you need to know about sentiment at the moment.

Sure, the business is growing, and the AI story is still intact, but the market doesn’t care. 

This wasn’t about fundamentals. 

It was about expectations… and clearly, they were too high.

That’s not disappointment in the company, that’s exhaustion in the trade.

So what else did we learn from yesterday's earnings reactions? Let’s dive into the details.

*Click the image to enlarge it

Constellation Energy $CEG had the best reaction score after...

Disney just beat the crap out of estimates and (surprising part here) guided higher for the year. 

Despite collapsing consumer sentiment, a drop off in US park visits, leaning even deeper into cruises (which might be the only way to vaporize your money faster than going to a theme park) and national disinterest in all things Marvel and Star Wars Disney guided pretty much every higher for just about every segment and hiked the annual estimate by over 30c a share.

Just to flex a little more Disney also raised expected cash flow by more than $2 billion. 

Oh yeah, Disney also added the news of a new park in Abu Dhabi. Which raises a whole bunch of questions

Let's Grade It!

Financials: A

This is why you have a conglomerate. Parks fall off? Entertainment picks up the slack. Cruises are disappointing? Streaming picks up some slack. This is probably the best quarter for Disney since the return of Iger, given the cross-currents.

Consumer: B+

Park profitability went up despite less traffic. I'd like to think that was because the company was controlling traffic levels by raising prices, a...

Every day, we sift through regulatory filings to spot where real conviction lies — cutting through the noise to highlight the most timely and meaningful insider moves.

Here's what stood out today:

📌Organon & Co $OGN — CEO Kevin Ali and CFO Matthew Walsh filed separate Form 4s, collectively scooping up nearly $399,918 in stock. 

This is easily the standout trade of the day. When the top two executives double down at the same time, that’s a serious vote of confidence — and a signal we don’t ignore.

📌Ardelyx Inc $ARDX — Foresite Capital Fund is back with a massive $1.6 million buy. 

When a fund known for backing early-stage innovation leans in this hard, it tells us they like what they see under the hood.

Here’s The Hot Corner, with data from May 6, 2025:

Click the table to...

Large-cap stocks continue to dominate the U.S. equity markets, and this trend looks poised to persist in the near future.

Growth $IWF has just broken to new relative highs relative to Value $IWD, signaling a shift in the underlying trend.

Despite the considerable headwinds faced by the U.S. markets and growth stocks in particular throughout this year, it seems that growth is far from surrendering.

In fact, it appears that growth stocks are positioning themselves for a potential rebound, showing resilience and the capacity to deliver returns despite their recent weakness.

Sign up for my free note here.

With the market back above key levels, we're seeing early signs of rotation, particularly into tech. 

Among the tech subsectors, cybersecurity is emerging as a standout, showing strong potential to lead the next phase of growth.

This group has been carving out a massive bottoming formation relative to the S&P 500 for over two years.

We've seen multiple failed attempts at the top of the range — but now we're back at those former highs, and this thing looks ready to go.

This is what a bearish-to-bullish reversal looks like.

If this base completes and this breakout holds, then it will mark the...

In trading, we’re taught early on that risk management is everything. “Use stop losses!” they say. And I agree. But what I’ve come to learn—especially when trading options in volatile markets—is that stops aren’t always about a precise line in the sand. Sometimes, they’re more like zones. Areas. Regions on the chart where you start paying close attention, rather than pulling the trigger at the first sign of trouble.

This came into sharp focus recently as volatility spiked. When the market threw its “tariff tantrum” and everything went haywire, we saw stocks and indices swinging wildly in both directions. On any given day, the same stock could be up 5% in the morning and down 5% by the afternoon. It was chaos. And chaos doesn’t play nicely with rigid stop-loss levels.

I had several long positions on during that time—mostly defined-risk spreads with expirations a few months out. The kind of trades that allow for a bit more breathing room. Yet many of these positions would repeatedly dip below my stop levels… only to recover just hours later. Over and over. A less experienced version of me might have panicked and bailed the moment my mental stop was breached. But I’ve...

The Taiwan New Dollar just posted its sharpest two-day rally against the US dollar—ever.

This wasn’t just any rally. It was a vertical move—TWD/USD spiked over 10% in two sessions, tagging a near three-year high in the process.

It caught the entire FX complex leaning the wrong way. It was statistically off the charts. 

This wasn’t a six-sigma move. Or even ten. We're talking fifteen sigma. That’s what quants call an “impossible” outcome. A market move so extreme that it breaks the model. 

A 10% move might not turn heads in a tape where spec. growth stocks like HIMS or PLTR can move that and more intraday—but for a currency pair? It’s seismic. Especially when the pair has been dozing in a multi-year falling wedge. 

That pattern? It just resolved higher. The breakout came right at the apex of the wedge—when no one was paying attention.

With this kind of volatility comes a forced unwind. Exporters, insurers, speculators—everyone caught leaning the wrong way gets squeezed out the door. Fast.

So what’s behind it—but more...

In today’s Daily Digest, we’ll review the following:

1. New position in TLT.
2. No adjustments are needed today.
3. Closed XLV at Profit Target.
4. Current status of open campaigns.
5. Volatility Snapshot.

Let’s dig in!

Berkshire Hathaway $BRK.B just delivered a double miss, falling short on revenue and earnings. 

But the real bombshell came later: Warren Buffett is stepping down as CEO at the end of 2025.

The result? Berkshire just logged its worst earnings reaction since 2011.

This isn’t just another miss. This is the market reacting to the end of an era. 

The Oracle of Omaha has been Berkshire's steady hand for decades, and while succession plans have been public for years, the official word hits differently. 

The stock sold off hard and fast.

This isn’t about numbers anymore. It’s about confidence.

When a fortress stock like Berkshire gets punished like this, it signals something deeper: investors are nervous...

Buffett stepping back into the shadows feels like a metaphor for this entire tape.

If Berkshire’s not safe, what is?

So what else did we learn from yesterday's earnings reactions? Let’s dive into the details.

*Click the image to enlarge it

Henry Schein $HSIC had the best...

Here are the most significant insider buys we’re tracking right now — starting with a major bet in Biotech and ending with a familiar name in Big Tech.

📌 Mimedx Group $MDXG – CEO Joseph H. Capper stepped in to buy 200,000 shares, equivalent to $1.27 million.

When the person steering the ship is buying with that kind of size, it usually means they believe in what’s ahead — or they know something we don’t.

📌 Hillman Solutions $HLMN – CFO Robert Kraft dropped nearly $1 million into his own stock.

If the finance chief is bullish, we take notice. It’s often one of the most telling insider signals out there.

Here’s The Hot Corner, with data from May 5, 2025:

Click the table to enlarge it.

📌 Algoma Steel $ASTL – Maple Rock Capital just upped its stake from 5.85% to 7.2%,...

Today's number is... 358

Gold has been in an uptrend for the past 358 trading days, marking the 8th-longest trend since the 1970s.

Here’s the chart:

Let's break down what the chart shows:

The black line in the upper panel indicates the price of gold. The blue line represents the 50-day moving average, while the red line shows the 200-day moving average of gold.

The black bars in the bottom panel indicate days when the 50-day average is greater than the 200-day average.

The Takeaway: To clarify, I identify a strong uptrend when the 50-day moving average is above the 200-day moving average. Currently, gold is experiencing one of the longest uptrends in the past 60 years, ranking as the eighth longest overall so far. At this point, there are no signs of this trend slowing down, as it continues to move upward and to the right on the chart. Therefore, it's difficult to be pessimistic about gold at this time.

However, Right now the 50-day moving average is 12.4% above the 200-day moving average. The last time the trend...

If there’s one word to describe the Trump administration over the past month, it’s “backfire.”

Just this past week, we’ve seen Australia ($EWA) and Canada ($EWC) rally following their respective elections—both countries opting for left-of-center governments in a clear rebuke of Trump-style politics. Their conservative leaders, caught mimicking Trump’s aggressive rhetoric amid a looming global trade war, were swiftly voted out.

Meanwhile, in a move that further underscores the unintended consequences, China ($FXI) has been quietly outperforming the United States ($SPY), even as tensions rise.

Talk about a backfire.

Since 2024, $FXI has been steadily trending higher relative to $SPY, and there’s no sign of that trend reversing anytime soon.

Strip away the politics, and the rotation out of U.S. equities starts to make perfect sense.

Valuations may not matter—until they suddenly do. U.S. stocks are commanding a premium that investors seem increasingly unwilling to pay in this environment. On the other hand, China offers both attractive valuations and strong momentum—a high-conviction setup...