Big day today! I got Josh Brown to come on the podcast and talk about all things Technical Analysis and Financial Markets. Josh is probably friends with more Technicians across the country than almost anyone else. He respects what we do, and even works in some trend following systems at his own firm. We discuss all of it!

In this episode we talk about Sector Weightings in Markets, how RIAs can bring Crypto to the portfolios of their clients and why Gold peaked 40 years ago when adjusted for inflation.

We don't always agree on things, but that's what makes this fun.

Josh and I battle it out in this one. Give it a listen and let me know what you think!

Also make sure to Subscribe to Josh's Youtube Channel: The Compound RWM

Enjoy!

While the US Stock Market has pulled back a bit this week, we've seen $VIX pop its head back up above 23 and print its highest levels in a month. And this isn't entirely surprising given that the highly watched Russell 2000 $IWM has been struggling to hold on to its yearlong support level of around 210.

But has the "all-clear" signal for the bears fired? Is it time to pile in short? We're not convinced yet.

Meanwhile, we've seen some pullbacks in semiconductors stocks we own ($NVDA and $MU most notably) that may get us stopped out soon. But when we zoom out to the bigger picture, as seen via the $SMH Semiconductors ETF, we see that we've been in a range for quite some time now. And even if we'd lose the support of this recent consolidation range at around 290, we can expect the 270-275 zone to offer a new level of support:

In recent weeks, we've been making a point about the importance of the derivative markets. When leverage and open interest is as elevated as it currently is, futures markets tend to govern short-term price action.

One of the most effective metrics to gauge this data is through funding rates.

Not only do we use this data to get a read of the positioning of speculators to help shape our macro crypto thesis. We can also use it on a case-by-case scenario to find high-conviction short and long setups within the alts.

Let's start by addressing the question of what is a funding rate.

We debuted a new scan recently which goes by the name- All Star Momentum.

All Star Momentum is a brand new scan that guides us towards the very best stocks in the market. This time around, we have incorporated our stock universe of Nifty 500 as the base. Among the 500 stocks that we follow, this scan will pump out names that are most likely to outperform the market.

While we go through our lists of sectors and stocks on a weekly basis, we thought of launching a product that would highlight the strongest performers in our universe. These are the ones that are primed for an explosive move.

Just like The Outperformers scan, this is a list of stocks belonging to the sectors that display relative strength in the market at any given point in time. Since sector rotation is the lifeblood of a bull market, we will be ahead of the curve before the gears keep shifting.

This is the video recording of the January 2022 Mid-month Conference Call.

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

One of the most important themes these days is the rotation between growth and value stocks. Groups like energy and financials have been breaking to new highs while growth and tech indexes have come under serious pressure.

So far, 2022 has been a true tale of two markets.

While cyclicals and value stocks appear to be gearing up for a momentous year, it looks like the party is finally coming to an end for the growth trade.

We want to lean on the value-heavy leadership groups for long opportunities in 2022. As for growth, we think it's likely to remain messy as interest rates continue to rise.  

When we look beneath the surface at growth and value stocks right now, our breadth data is confirming the action we’re seeing at the sector level.

Let’s dive in and discuss... 

Here's one way to visualize the opposing paths of large-cap value and large-cap growth right now. This indicator shows us the percentage of stocks above their 50-day moving averages for each of these indexes:

...

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

What started out as a potential bullish continuation pattern in the US Dollar Index $DXY has turned into a near-term top.

After weeks of failing to hold breakouts on an individual currency basis, the tight coil in the DXY finally resolved lower.

The brief reprieve in USD strength was immediately felt across markets last week, with cyclical/value stocks and procyclical commodities catching an aggressive bid.

Now that the headwinds associated with dollar strength appear to be easing, will risk assets enjoy a tailwind in the form of sustained USD weakness?

Or was this just the latest fake-out from the DXY?

Let’s take a look at a couple of charts and highlight the levels we're watching in the coming weeks and months.

First up is the US Dollar Index:

After the...

From the desk of Willie Delwiche.

Key Takeaway: New highs being seen in areas where most investors have little exposure. Liquidity pressures build as corporate bond yields rise. Indexes consolidating after recent highs lacked broad support.

• Energy remains at the top of the relative strength rankings, followed now by Financials. Materials continued to climb, rising to the number four spot this week. 
• Defensive sectors saw their recent relative strength moderate last week. Consumer Staples dropped one spot, Utilities were down two spots and Real Estate fell by three.  
• Our industry group heat-map shows this is a sector/group-sensitive rather than size-sensitive market right now. Growth sectors are being dragged down regardless of size.

In yesterday's note, we outlined our patient approach in the face of this messy tape.

For the most part, we're sitting on the sidelines waiting for an uptick in investor demand to drag the market out of this correction.

Current price action is being heavily driven by the futures market, which will only serve to increase the probabilities of whipsaws and fake-outs that can wear on traders' emotional as well as their financial capital.

Additionally, when evaluating the altcoins, there isn't any edge in being positioned aggressively long.

As we'll explore in today's post, many names look vulnerable for further near-term downside, and even most of the leading alts have lost much of their bullish momentum over the last few days.

Let's dive in.

On this episode of Pardon The Price Action, we're talking about the implications of rising interest rates. This is no longer an environment where Growth stocks outperform. It's actually the exact opposite.

We're also seeing these signs from other countries around the world with much more exposure to the Value sectors like Energy, Materials, Industrials and Financials.

US Investors have a lot more exposure to Technology and Growth than almost every other country in the world.

I think Latin America is worth watching, China and many other emerging markets.

We believe this time IS different!

Check out the full video:

Over the last quarter, we saw the market really struggle to pick a direction and get going. There were a lot of sideways moves and a lot of failed breakdowns. Currently, we've seen a resumption in the positive trend in most sectors, supported by market breadth.

Today we're taking a look at stocks from the Industrial Manufacturing sector. A handful of stocks are signifying what could be a good bullish going forward.

So let's see what we have today!

What if the outperformance we've seen from the United States stock market for so long is behind us?

Is your portfolio prepared for an environment where US stocks underperform the rest of the world?

What about your peers?

Do you think Financial Advisors across the country have positioned their clients to take advantage of outsized returns outside the United States?

I talk to a lot of people.

And my answer is no. A big fat obnoxious NO.

I don't think they're ready at all. And the pain could last a while.

By the time your average financial advisor gets off the golf course and notices how poorly positioned their clients are, it's usually much later in the cycle.