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As I’ve been pointing out the past few days, I think stocks aren’t just going higher any longer…

At this point, my observation is stocks have been kind of soaring.

I’ve noticed aggressive momentum has been picking up in many corners of the market.

Stocks that get a bid move up fast… and then they move even higher and faster. It’s just the way the market has been acting from what I’ve seen.

As always though, somebody has to be at the forefront, leading the way…

So, who’s the MVP? Which group is (or, actually, has been) the strongest relative performer?

 

SPY’s Pointing Up

 

Before I dive into it, let’s zoom out and look at the biggest picture.

Here’s SPY’s weekly chart:

 

 

No explanation needed here, really.

At this rate, S&P 500 can retrace around 10% and still(!!!) maintain the uptrend, based on my chart analysis. Of course, the market moves fast and this isn’t set in stone. The S&P 500 can retrace 10%, then trade sideways, and dip more, then the trend would be “broken”.

I’ll just have to wait and see what happens.

Now, there still are a good deal of people trying to make a bear case….

Well, I’m not even going to get into this debate until we have a weekly close below February’s highs.

We’re in a full on bull market, no doubt in my mind, question closed.

Let’s now move on to the juicy part…

 

Small Caps Firing On All Cylinders

 

It is no news (to my readers, at least) that there’s been a considerable rotation down the market scale.

I noted this about 3 weeks back, right as micro- and small-caps were starting to show signs of outperformance.

Well, here’s where we stand today, a short while later:

 

 

I could’ve said there’s very strong momentum to the upside, but don’t want to state the obvious.

This might seem overextended, but keep in mind the subgroup has done virtually nothing for 18 whole months.

As long as the current breakout maintains, I view this as bullish for small-caps.

The accelerating momentum thesis is further confirmed if you looked at small-cap growth oriented stocks.

Here’s PCST:

 

 

Much like it’s broader sister-index, PCST remains historically elevated and is now accelerating its extension on both absolute and relative terms.

Author:JC Parets

 

It’s not news anymore that the stocks are on the uptrend.

Unlike some permabears in the media, I’ve been banging the table on this for months.

Over the past few trading sessions, the data has been pointing me to another peculiar market condition – accelerating momentum.

Momentum is usually a by-product of greed, and it can cause big moves… very big moves in fact…

And very quickly too, in my opinion.

Today, I’m giving you three names that look poised to accelerate in the near term:

Are These Momentum Stocks About to Rocket Launch Higher?

I’ve been talking about the incredible strength in clouds in some of last week’s letters, so it’s only fair I begin with a cloud name – Zscaler (ZS).

This is a relatively new cloud-security company and it’s been on the move:

Talk about leadership here…

The stock is up over 6-fold since it IPO’d some 2.5 years ago.

And by the looks of it – no stopping is near, as it continues to show impressive outperformance.

Just last week on good ER, it aggressively broke out of a months-long consolidation and to new all-time highs, both relative and absolute.

If $178 holds, which has so far been the case, it can continue to $270 with no looking back.

Much like clouds, I’ve also bored you by repeatedly talking about Semiconductors.

XPO Logistics (XPO) is a multinational supply chain solutions company specializing in the transportation and logistics industry.And that’s the chart:

Similar to many in the sector, the stock just broke out of a multi-year base and updated its relative and absolute 52-week highs.

What differs is this one is the gradual acceleration that we’ve seen over the past few months.

With the industry as a whole on tear and clear skies above on the chart, XPO might very well assume a leadership role and accelerate rapidly towards its next objective at $164.

This name is very bullish as long as it holds the $116.

Last but not least, I’ll give an update on a name I called out back in August – Sea Ltd (SE).

Back then, my original price target for this Southeast e-commerce giant was $235.

The stock’s been in a continuous uptrend and just resolved higher aggressively out of a text-book multi-week consolidating/wedge pattern.

As long as it stays above the breakout level at $190, it should only be a matter of time till my target gets hit.

 

Author:JC Parets

In my letter from yesterday, I did an in-depth review of the Tech sector and my conclusion was an unsettling one… for the bears!

Despite a minor hiccup at the start of the current rally cycle, the tech names are now firing on all cylinders.

With the exception of a few lagging large caps, every subgroup and every subsector has broken out and is now doing it’s usual thing – taking out highs after highs.

But then there were a few that stood out even by Tech’s draconian standards of bullishness…

Today’s biggest winners are Clouds and Software firms, and this is exactly what I’m going to talk about.

 

Are These Breakouts Stocks About to Rip?

 

My first pick this weekend is Alarm.com (ALRM).

The name and the ticker kinda give it all away, but for the sake of clarity I’ll expand a bit – this $4B company provides cloud based security solutions for smart homes and businesses.

Pretty cool is it not?

The market seems to agree with me on that one:

 

 

The stock just broke out a 20-month base to fresh all-time highs.

It continues a strong uptrend on both absolute and relative basis and is not far from all-time highs vs the broader market.

This $72 is a major level here – getting it cleared would be very bullish for the stock with the next short term price objective at $97.

Next up is SS&C Technologies (SSNC).

This is a software provider for the financial services industry and it’s currently valued at about $18B.

Here’s what it looks like:

 

 

The stock has been in a solid uptrend for nearly a decade now.

On a relative basis the picture isn’t bad either – the trend is definitely higher, but the name has been stuck in a sideways consolidation since 2015.

It all may be about to change though, as the price is pressing on all-time highs on relative terms having just resolved higher to absolute all-time highs.

As long as SSNC can hold the gains and stay cleanly above $68 – it’s a very bullish uptrend continuation with the next level at $92.

As always, it’s important to focus on the data, rather than what’s on the tube. If you want to learn how to utilize data to your advantage, then you must subscribe here… and you’ll find out what my best plays are.

Author:JC Parets