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.

Where are we in the cycle?

That's something I like to think about.

The reason is because it helps me allocate my time better. Should I be spending more time looking for stocks to buy, should I be spending more time looking for stocks to sell, or should I be at the beach because the market is a mess?

Being able to answer this question correctly can be a huge advantage.

I think blindly incorporating a specific type of strategy at all times, regardless of the market conditions seems awfully difficult.

If we can first identify what type of market environment we're in, then we can pick and choose which tools and strategies are best fit for that part of the cycle.

Are we in a high volatility environment? Then why would we implement strategies that are best suited for low volatility environments?

Are we in a trending market environment? Then why would we use the tools and strategies that are best for sideways rangebound markets?

I think we first identify where we are in the cycle, and then decide how to approach the market from there.

This is the video recording of our September 7, 2022, Inside Scoop Weekly Strategy Session.

You've heard me say it a million times by now.

It's going to be really difficult to make money long most stocks or crypto the rest of the year if the US Dollar remains strong.

Check out last night's video about what we're doing about it.

We got just a little bit of Dollar weakness starting in mid-July and stocks ripped higher. Thousands of points added to the Dow, Ethereum doubled and the average stock on the Nasdaq rallied over 40%.

We saw one of the most historic short-squeezes in history. And all it took was just a little bit of Dollar weakness. It wasn't even that much.

But then once that Dollar strength came back last month, the bid in stocks and crypto disappeared.

Here's a zoomed out look at the negative correlation between stocks and the Dollar:

The most significant insider transaction on today's list comes in a 13D from Carl Icahn, who increased his ownership stake in Southwest Gas $SWX by 1%.

Icahn now owns 9.7% of outstanding shares, up from the 8.7% he reported on August 16.

This is the video recording of our September 6th Monthly Charts Live Strategy Session

From the Desk of Steve Strazza @Sstrazza.

Welcome back to Under the Hood, where we'll cover all the action for the week ended September 2, 2022. This report is published bi-weekly and rotated with our Minor Leaguers report.

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.

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.

The most significant insider activity on today's list comes in a Form 4 filing by Juan Delgado-Moreira, vice-chairman of Hamilton Lane Incorporated $HLNE.

Delgado-Moreira reported a purchase worth roughly $1 million.

Stocks had a ripper of the June lows, and now many markets have digested those gains.

How they correct, and how they digest gains, gives us a lot of information.

To help put things in perspective, the S&P500 has retraced exactly 61.8% of the entire rally of the lows.

This is a perfectly normal correction:

We debuted a new scan recently- The Outperformers.

The Outperformers is our newest scan that pinpoints the very best stocks in the market. It’s the fastest, easiest way to find quality names that are primed for major moves.

The goal is that as the market rally progresses, the sector rotation within the market will reflect in this scan. So while our Top/Down Analysis helps us with the broader view of the market, this Bottom/Up scan makes sure that we catch the slightest change in sentiment.

Remember when the stock market peaked in February 2021?

That's when the New highs list peaked. That's when the Nasdaq Advance-Decline line peaked. That's when Chinese Internet Peaked. That's when Biotech peaked. That's when all the ARKK funds peaked.

February 2021 is when everyone had a SPAC.

Remember SPACs?

This group of "Special Purpose Acquisition Companies" was a poster-child for the excess environment of Q1 2021.

These SPACs were the biggest pieces of hot garbage on the market. And everyone wanted them.

And then the market peaked and their prices came tumbling down.

Now here we are, 18-months later. And they've just decided to delist the SPAC ETF $SPAK.

A sign of the times?