Heading into 2025, a key theme that stands out is speculative growth.

The Ark Innovation ETF $ARKK has completed a full transition from red to dark green, indicative of strong relative strength.

In the below chart, we've stretched the x-axis to bring awareness to the scope of price discovery that could unfold in 2025.

It’s easy to focus on the leaders, but let’s shift our attention to the bottom of the rankings — energy.

This sector has been consistently lagging, showing red for some time. That’s the beauty of these Power Rankings; they give us an early warning when trends start to shift.

Energy hasn’t turned the corner just yet.

Meanwhile, Crude Oil is sitting at a critical support level and remains tightly coiled.

If we see an upward breakout in Crude, it wouldn’t be surprising to watch Energy transition from red to green.

Large-cap and growth stocks continue to outperform, while small-cap and value stocks lag behind.

One key development we're watching closely is whether the recent softness in U.S. indices, particularly the S&P 500, marks the formation of a potential lower high.

Should the S&P break to a new low, it would confirm a shift in the short-term trend to the downside.

Why guess when you can know?

Unlock expert insights with All Star Charts Premium and confidently navigate market shifts. For a limited time, get $500 off an annual membership and start maximizing the...

It's difficult to ignore how green Argentina $ARGT has been on our rankings ever since Javier Milei's election victory. It's been such a standout in a region that has struggled in recent times.

Compare Argentina $ARGT to the remainder of Latin America.

A development that has us curious is whether Latin America broadly speaking while begin to recover into the new year.

Here is the iShares Latin America ETF $ILF sitting on a key level of support; this is a logical area for this region to see a recovery from its recent weakness.

This year, much of the buzz has been around technology subgroups, especially Semiconductors.

However, two less-hyped but highly consistent performers have been Insurance and Aerospace & Defense. Over the past three months, these "boring" sectors have shown steady strength, staying consistently green.

Year-to-date, Insurance ($IAK) has delivered an impressive 26.40% return (green line), while Aerospace & Defense ($ITA) has climbed 18.30% (blue line).

Even more encouraging is that both are sitting near logical support levels, presenting favorable entry opportunities—assuming their strong trends persist.

Speculative growth has been the strongest theme into the end of the year.

But interestingly, we're noticing a major divergence between U.S. growth and E.M. growth. While the former is at the top of the rankings, E.M. growth has transitioned to red.

We need to see the Emerging Market Internet ETF $EMQQ reclaim this breakout level if we want to have a more positive stance on this theme.

We’ve noticed a significant shift in both Large Cap Technology ($XLK) and Equal Weight Technology ($RSPT), as they transition from red to deeper shades of green, as illustrated below.

This suggests a resurgence of growth leadership heading into 2025.

From a technical perspective, the breakout of the Large Cap Technology ETF ($XLK) from a six-month base further supports this trend.

With this setup, there’s considerable potential for technology to push higher as we move into the new year.

We're seeing a stronger performance in larger stocks and those within the growth factor, with more of them in the green compared to smaller and value stocks.

This is especially clear in the Small Cap ETF ($IWM), which recently failed at a key level of resistance.The Vanguard FTSE Europe ETF ($VGK) breaking down to fresh lows is particularly concerning. A swift recovery here is essential to shift the narrative.

Typically, after a rejection like this, we tend to see a period of sideways movement as the market absorbs overhead supply before the next move higher.

One striking observation is the widespread underperformance of European ETFs, which are predominantly in the red.

Visualize this: a map of Europe shaded with the same colors as the table. With few exceptions, the dominance of red over green is hard to miss.

The Vanguard FTSE Europe ETF ($VGK) breaking down to fresh lows is particularly concerning. A swift recovery here is essential to shift the narrative.

While value stocks have been beaten down in December, what remains unchanged is the weakness out of energy.

Just look at how much red is in all the energy industry groups.

The broader sector has been in a straight line lower this month, eroding any YTD gains it had. There's no sign that this weakness is changing.

Speculative growth has been a strong area of leadership since the election.

You can see how the flagship Innovation ETF $ARKK has transitioned from deep red to deep green, along with the other funds.

While we've seen ARKK sell-off following the FOMC, the longer-term picture is crystal clear.

This is an area of the market that has undergone a structural trend reversal, which is clearly bullish looking out into 2025.

I've noticed that the technology sector ETFs have turned from red (or light green) to a darker shade of green.

This makes sense with growth picking up steam while value has cooled off.

All technology sector ETFs look prime to break to new highs. While larger technology companies have outperformed, it's positive for the sector to see all three at their highest level they've been all year.

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.

It's a new year and the market is looking forward. 

It doesn't matter what happened last year, as far as our decisions are concerned. But let's not forget that humans are irrational, and they will certainly let the past year or two impact their decision making.

They can't help themselves. So it's up to us as traders and investors to extract those dollars for our own selfish reasons. 

We're here to make money. Period. Taking advantage of human flaws is a great way to do that, as I've been showing you here every day for over a decade. 

Yesterday we discussed the irrational behavior we're seeing from investors in the middle of a bull market. They're running scared, just as market breadth is improving to the upside, across multiple timeframes.

What...

The Retail Investors are scared to death. And that's a good thing.

We don't want individual investors too optimistic. That's when stocks sell off. It's when they're pessimistic and worried that you see the best forward returns.

Go back and see for yourself. It's all public information. These are the people we want to fade. This is the "Dumb" money, so to speak.

Dig this. The first sentiment data for the year just came out from the American Association of Individual Investors with the fewest number of bulls since April of last year.

In the middle of the bull market, they're crazy scared. 

Good.

Now keep in mind, this is specifically what they're saying. 

But what are they doing?

Well, the Put/Call Ratio just hit new 4-month highs. This means investors are buying insurance (Put options) at a much faster rate than they're betting on higher stock prices (Call options). 

That's also evidence that they're scared. Why else would you be buying insurance at such a fast rate?

Now, what else are they doing?

Active Investment Managers (NAAIM) have on the least amount of long exposure since...

Did you know China outperformed the United States stock market in 2024? We have the data.

We think this relative strength will persist, and if that's the case, don't forget about copper!

We discussed the long-term positive correlation between Chinese equities and copper futures a few months ago. 

Why does this relationship exist?

China is the world's largest consumer of refined copper and accounts for over 50% of global consumption. 

If one is going to work, so will the other.

More importantly, copper futures are testing a key level of interest:

Copper futures are potentially carving out the right shoulder of a multi-year inverted head and shoulders pattern.

This consolidation is happening in a primary uptrend: from 2020 to 2021, copper futures rallied nearly...

The market seems ripe for a good short squeeze. Don't you think?

Despite many market participants questioning the robustness of the current bull market, the worst stocks in the world keep outperforming. 

These stocks will get blasted and dramatically underperform in a true bear market environment.

We're seeing the opposite.

So we've gone through our Freshly Squeezed universe, and one name stands out.

Eos Energy Enterprises $EOSE, a $1.2B battery stock.

It's sporting a 27% short interest and a 7x days-to-cover ratio.

When the short sellers overstay their welcome (as they have in this instance), we look for opportunities to take the other side. 

Why? The risk versus reward is skewed in our favor.

Today's trade is in a stock who's price action is mimicking what their products delivers for its customers -- it's going vertical! How's that for kizmet?

That trade might classify as a "hard trade," but I'll be doing what I can to increase the odds of success in my favor.

Thanks to everyone who joined us for today's Hot Corner Insider Weekly Strategy Session.