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.

From the desk of Steve Strazza @Sstrazza

We held our May Monthly Strategy Session on Tuesday. ASC Premium Members can click here to access the recording and the chartbook.

Non-members can get a quick recap of the call simply by reading this post each month.

By focusing on long-term, monthly charts, the idea is to take a step back and put things into the context of their structural trends.

This is easily one of our most valuable exercises as it forces us to put aside the day-to-day noise and simply examine markets from a “big-picture” point of view.

With that as our backdrop, let’s dive right in and discuss three of the most important charts and/or themes from this month’s call.

This is the video recording of our May 4, 2022, Inside Scoop Weekly Strategy Session.

The CEO, chairman, president, and three directors of B. Riley Financial Inc $RILY filed Form 4s revealing purchases of their own stock.

Of the six insiders, the largest splash was made by chairman and CEO Bryant Riley himself. He reported purchasing over $10 million worth of shares.

Whenever we see this many insiders buying at the same time, we want to pay close attention.

What do they know?

The largest insider transaction on today’s list is a Form 4 filing by Simon Groom, who reported an additional $43 million purchase in the broadcasting company iHeartMedia $IHRT.

The chief financial officer at General Motors $GM, Paul Jacobson, revealed a purchase of roughly $1,357,650 worth of his own company's stock in a Form 4.

CFO activity always catches our attention as not many employees know and understand a company’s financial condition better.

From the desk of Steve Strazza @Sstrazza.

Welcome back to our latest Under the Hood column where we'll cover all the action for the week ended April 29, 2022. This report is published bi-weekly and rotated with our Minor Leaguers column.

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.

The largest insider transaction on today’s list is a Form 4 filing by George Simeon, director of Nkarta Inc $NKTX, who reported a $10 million purchase.

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.

From the desk of Steve Strazza @Sstrazza

Our Top 10 Charts Report was just published.

In this weekly note, we highlight 10 of the most important charts or themes we're currently seeing in asset classes around the world.

Indexes Hit New Lows

We’re seeing more and more stocks and indexes resolve lower from distribution patterns and violate critical support levels. Many more are on the brink, challenging pivot lows and threatening to follow their path.

The Nasdaq 100 (QQQ) and Russell 2000 (IWM) are excellent examples of this as both are violating their recent lows and resolving to the downside. We’re paying extra special attention to these patterns as their breakdown levels coincide with the AVWAPs from the COVID lows. These levels represent the price the average investor has paid for shares since March 2020, making them logical potential support zones.

Now that these indexes have taken out the confluence of support at their pivot lows, we’re likely to see further downside and increased volatility. Bulls need to come out and repair this damage immediately.

From the desk of Steve Strazza @Sstrazza

Check out this week's Momentum Report, our weekly summation of all the major indexes at a Macro, International, Sector, and Industry Group level.

By analyzing the short-term data in these reports, we get a more tactical view of the current state of markets. This information then helps us put near-term developments into the big picture context and provides insights regarding the structural trends at play.

Let's jump right into it with some of the major takeaways from this week's report:

* ASC Plus Members can access the Momentum Report by clicking the link at the bottom of this post.

Macro Universe:

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

The rally in some commodities has been near-vertical this year.

And we’re seeing this strength across the entire complex -- from energy contracts like crude oil to base metals such as tin and even grain markets like wheat.

While these kinds of moves are bullish over longer time frames, when things get too hot (like they have), it’s often not sustainable on a tactical basis. 

This is the situation right now for a lot of commodities. We think a period of well-deserved digestion is underway for the broader asset class.

But this doesn’t mean there won’t be fresh up-legs taking place in some individual contracts.

As this new secular bull market matures, pockets of strength will rotate across the space. Our only job is to find the emerging leadership.

Today, energy and base metals are correcting after explosive rallies while strength emerges from the agricultural complex -- especially grains.

From the desk of Steve Strazza @Sstrazza

Our International Hall of Famers list is composed of the 100 largest US-listed international stocks, or ADRs.

We’ve also sprinkled in some of the largest ADRs from countries that did not make the market-cap cut. 

These stocks range from some well-known mega-cap multinationals such as Toyota Motor and Royal Dutch Shell to some large-cap global disruptors such as Sea Ltd and Shopify.

It’s got all the big names and more--but only those that are based outside the US. You can find all the largest US stocks on our original Hall of Famers list.

The beauty of these scans is really in their simplicity.

We take the largest names each week and then apply technical filters in a way that the strongest stocks with the most momentum rise to the top.

Based on the market environment, we can also flip the scan on its head and filter for weakness.

Let’s dive in and take a look at some of the most important stocks from around the world.

Here’s this week’s list: