Interesting Mix – April 23rd, 2021

The S&P 500 closed near a new high again. The market pushed down Monday, Tuesday and Thursday but could not build any downside momentum. The resilience is impressive. The Nasdaq is building out a consolidation zone after the run up off the March lows. All of the indexes are poised to break out higher, and the breadth suggests that is probably what comes next.

Globally, the markets were down around 1%, which is not exactly plummeting. It looks more like a consolidation within an uptrend and the SSIH suggests that in the US markets as well. Commodities had an up week, as industrial metals commodity related trades were up nicely. The charts related to electric vehicles were setting up and some of the strongest charts in the list were the industrial metal miners. Corn, Soybean and Wheat had big moves higher too.

This week saw more stocks up big than down big, which is interesting with the indexes finishing slightly lower. I am expecting a turn towards the materials, industrials, energy and technology sectors.

While bitcoin finished the week around $50,000, it traded as low as $47,500. Once again, the wide range in Bitcoin is a lot more difficult to buy and hold with a 27% pullback off the highs in a little more than a week.

Summary: A major trend line is breaking in commodities. I want to be part of that trade as it breaks out. The clean tech space is a massive user of commodities, so my favorite way to play a lot of these ideas is through the commodity related stocks. In particular, look to the industrial metal miners. I don’t want to be a turkey waiting as the commodities move higher, so I am setting up in the clean tech related trades expecting to climb higher.

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