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.

It's easy to get lost in the weeds.

As humans, we're vulnerable to it.

So it's important to understand the way our minds work and set up gates that can bring us back home, to what's important.

In the case of trading and investing, being on the right side of the trend.

A great way to do that is by zooming out.

Here's Bitcoin, for example, going back to 2014.

Doesn't this give you a much different perspective compared to most Bitcoin charts you see?

Turtle Creek Asset Management continues to build its position in the door and window manufacturer JELD-WEN Holding $JELD. 

Friday’s Form 4 filing is its fourth filing in just two weeks and reveals an additional $16.5 million of share purchases.

We are almost done with the first quarter of the calendar year and the last quarter of our financial year. There are certain sectors that are peeping out from beneath the surface and hence attracting attention. Is this a theme we may see play out in the quarter going forward? Most likely. Most sectors have remained sideways or subdued in their move and they are finally picking a side!

Today we are here to discuss one such sector and some interesting setups that one could take advantage of.

Let's see what's on the roster sheet today.

We mentioned this in the recently concluded conference call, and we'll say it again- Bouncebacks are here! From within the price bouncebacks that we're seeing certain sectors are displaying more strength. One such sector is the Industrials. We're talking about the Industrial Manufacturing sector, so don't go looking for the US sector XLI.

From the desk of Steve Strazza @Sstrazza

Our Hall of Famers list is composed of the 150 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 has all the big names and more.

It doesn’t include ADRs or any stock not domiciled in the US. But don’t worry; we developed a separate universe for that which you can check out here.

The Hall of Famers is simple.

We take our list of 150 names and then apply our technical filters so 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:

From the desk of Steve Strazza @Sstrazza

The biggest theme on our Hot List and Inside Scoop tables has been the strength from commodity stocks.

Since we launched the column, we’ve discussed the strength from energy stocks like Occidental Petroleum $OXY, agricultural stocks like Corteva $CTVA, and industrial metal names such as Freeport-McMoRan $FCX.

These names have all recently broken out and continue to show leadership. When the same theme continues to work, we want to continue to bet on it.

And that’s exactly what we’re doing with today’s setup.

Revolution Medicines $RVMD director Thilo Schroeder is back on our list for the third time in just two weeks with another Form 4 filing.

Following last week’s $3.4 million buy, he revealed an additional $5.5 million purchase in his latest filing.

The question keeps coming up.

As it should.

"JC, do you think this bounce in Growth has legs?"

And the answer is that yes, I think it could. There are some nice trades in these beat up growth areas that have set up very nicely.

We discussed a few of these once again on Monday night.

But I believe this one really depends on your time horizon.

Can Growth outperform for a bit? Sure.

But do I think it can do that throughout the rest of the year?

No I don't.

Here's the Large-cap Growth vs Value in black, as well as the Small-cap Growth vs Value in Blue:

There’s a handful of large Form 4 purchases on today’s list.

Robert Gervis, director of Aspen Aerogels $ASPN, purchased $4.5 million of stock.

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.

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.

This one has to be the Chart of the Day.

We're looking at the outperformance of Square vs Paypal.