You know me, I'm skeptical of everything and everyone.

You have to earn my trust.

And if there's one indicator in this market that has earned my trust and attention over the years, it's the relationship between Consumer Staples and the rest of the market. More specifically, Staples relative to Consumer Discretionary stocks.

You see, when portfolio managers believe stocks are going higher, they are going to overweight Consumer Discretionary stocks. These are things like Retailers, Automobiles and Housing stocks. Areas where "Consumers" spend their "Discretionary" Income.

Consumer Staples, on the other hand, are things "Consumers" are going to spend money on regardless of economic conditions, therefore being "Staples". Think Toothpaste, Laundry Detergent, Beer, Soda and Cigarettes.

I have two ways to look at these:

In the week gone by, the Realty sector performed exceedingly well. We added the index to our Three Charts for the Week Ahead post as well. The reason for that was that the index constituents are trading at crucial levels.

With the stocks jumping up above their resistances, we thought a post should be dedicated to the Realty sector.

So let's take a look at some interesting ideas.

Realty has been moving sideways for a while after breaching its 2018 highs. In the week gone by, we witnessed a strong move in the index. While the index is trading close to its overhead resistance, the strong momentum could take the price higher.

But about relative strength? Do you reckon there's something there?

From the desk of Steve Strazza @Sstrazza

Welcome to our latest “Minor Leaguers” report.

We’ve already had some great trades come out of this small-cap-focused column since we launched it late last year and started rotating it with our flagship bottoms-up scan, “Under The Hood.”

We recently decided to expand our universe to include some mid-caps….

For about a year now, we’ve focused only on Russell 2000 stocks with a market cap between $1 and $2B. That was fun, but we think it’s time we branch out a bit and allow some new stocks to find their way onto our list.

The way we’re doing this is simple…

To make the cut for our new Minor Leaguers list, a company must have a market cap between $1 and $4B. And it doesn’t have to be a Russell component–it can be any US-listed equity. With participation expanding around the globe, we want all those ADRs in our universe. 

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. What remains is a list of stocks that large financial institutions are putting big money behind… and they’re doing so for one reason only: because they think the stock is about to move in their direction and make them a pretty penny.

Last Friday I had a nice little chat with the boys over at Benzinga.

It's funny because I've been doing this pretty regularly with these guys for almost a decade, which is kind of unbelievable to think about.

Shout out to Joel, Dennis and Spencer. Keep up the good work fellas!

During our chat we talked about relative strength and which individual stocks stand out in the current environment.

Check it out:

This week we’re looking at a long setup in the Realty sector. Nifty Realty broke out of an 11-year base and has picked up momentum. At this time we're looking for an interesting idea in this space.

Let's take a look at this stock.

We retired our "Five Bull Market Barometers" in mid-July last year 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.

From the desk of Steve Strazza @Sstrazza

Our Hall of Famers list is composed of the 100 largest US-based stocks.

These stocks range from the mega-cap growth behemoths like Apple and Microsoft--with market caps in excess of $2T--to some of the new-age large-cap disruptors such as Moderna, Square, and Snap.

It’s got all the big names and more.

It doesn’t include ADRs or any stock not domiciled in the US. But don’t worry; we’re developing a separate universe for that, and we’ll be sharing it with you soon.

So, The Hall of Famers is easy.

We simply take our list of 100 names and then apply our technical filters in a way that the strongest stocks with the most momentum rise to the top.

Let’s dive right in and check out what these big boys are up to.

Here's this week's list:

And here's how we arrived at it:

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

I was talking to the team earlier this week and mentioned that I was having a hard time writing. Grant and Ian were quick to remind me that it's probably because "nothing new is happening!"

They were right. Until now...

We finally got a major resolution in what we consider one of the most important charts in the world these days.

I'm talking about the US 10-year yield reclaiming that critical 1.40% level this week. And this begs the question as to what a rising rate environment might mean for investor portfolios.

Well, one thing we know for sure is we want to stay away from bonds... unless we're shorting them.

But how do we want to position ourselves in the stock market if yields are breaking out?

It's simple really. Some stocks do better with rising/higher rates, while others thrive in markets characterized by low growth and low yields. If this is the beginning of a fresh move higher for yields, then we want to be focused on buying the stocks that are likely to benefit the most.

High-beta stocks are hitting new multi-month highs relative to low volatility.

This is the opposite of what would be happening if the world was about to come to an end.

The ratio between High Beta stocks and Low Volatility stock basically stopped going up last February.

Congratulations to those holding positions in Zee Entertainment, for you, have been rewarded! Well, at least for now.

Zee has been notoriously stubborn for remaining sideways for all of seventeen months now. That's a long time, considering several stocks have grown two-fold, three-fold at the least.

But Zee has also been a part of a sector that has consistently underperformed the market.

But have things changed with the move we saw in Zee over the past two weeks?

Maybe...

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

Considering the selling pressure in recent weeks, we were very excited to take a look at our breadth indicators today to see if we finally saw some downside expansion worth pointing out. Spoiler alert: There was nothing there.

Being as we're in a sideways market, we're always on the lookout for a change in character in internals that might suggest some resolutions are finally on the horizon. And since bears have been driving stocks lower since early this month, our focus is on new short-term lows. 

With the S&P experiencing some volatility and revisiting its 50-day moving average this week, did we finally get that "fall day?"

Two things we've been hitting on ad nauseam for over a quarter now are the consistent lack of new lows and the fact that most stocks have already corrected beneath the surface.

Today, we're going to revisit both of these key themes and see where we currently stand.