The intermediate-term trend has turned up for all of the major indexes, the number of stocks hitting new lows is drying up nicely, individual leading stocks are acting well and, while it’s not a torrent, we are seeing some more breakouts and setups as the days go by. It’s not 1999 out there, with wide swaths of the market still repairing the damage from recent months, so we continue to favor a step-by-step approach when it comes to extending your line. We’ll move our Market Monitor up to a level 6 and will continue to raise it should the rally continue to gain steam.

This week’s list has another crop of super-strong charts, and from a variety of industries, too. Our Top Pick isn’t a lightning-fast mover, but it looks like the leader in a group that’s shown exceptional strength off the lows and has a history of trending nicely when conditions are favorable.

The November market rally continues, as signs of renewed health among stocks are popping up in more and more places – including in the Stock of the Week portfolio. So today, we’re only adding – and upgrading. The new addition is a longtime recommendation by Cabot Dividend Investor Chief Analyst, Tom Hutchinson, and one that’s having a surprisingly good year. Lately, it’s gone into overdrive and yet still trades well below its highs. We try and capture the stock’s newfound momentum as we head into the holiday season.

Enjoy – and Happy Thanksgiving!

As we enter the holiday-shortened week, we have one open position. My intent is to add another trade this week, so we have at least two positions headed into the December expiration cycle. Other than that there isn’t much to discuss at the moment.

Earnings season is mostly behind us as we enter the week of Thanksgiving and a holiday-shortened week of trading. There are still a few opportunities lingering ahead, but the potential trades are few and far between until another round of fresh earnings announcements starts anew around the middle of January.

As we enter the holiday-shortened week, we have five open positions. My intent is to sell puts in BITO and DKNG this week, so we have at least seven positions headed into the December/January expiration cycles. Both stocks allowed us to prosper, earning more than 13% in total at expiration last Friday with DKNG being the big winner, as we locked in 9.6%.

Before we dive into this morning’s Weekly Review, I wanted to bring to your attention to the schedule for this holiday week. I will be working/trading as normal Monday through Wednesday, and then will be off Thursday through Monday morning, which means we won’t be sending a Daily Watchlist or the Week in Review on Monday, November 27. Have a great Thanksgiving!

Before we dive into this morning’s Weekly Review, I wanted to bring to your attention to the schedule for this holiday week. I will be working/trading as normal Monday through Wednesday, and then will be off Thursday through Monday morning, which means we won’t be sending a Daily Watchlist or the Week in Review on Monday, November 27. Have a great Thanksgiving!

The market continues to improve, with our Cabot Tides turning positive earlier this week. Now, not everything is rowing in the same direction, and among growth stocks, the pickings are relatively concentrated, so for now we’re stepping slowly into stocks and building positions rather than cannonballing into the pool—we added a chunk of money earlier this week, and tonight we’re adding one new half-sized stake in a volatile name we’ve been following for a while but has now changed character on the upside.

Elsewhere in tonight’s issue we review all our stocks, dive into many encouraging pieces of secondary evidence and one group that has a history of trending and is showing outsized institutional accumulation right now.

In the November Issue of Cabot Early Opportunities we lean into the strengthening market with a group of companies doing everything from providing security for new AI applications to paving roads in the Sun Belt to making packaged foods for health-conscious consumers, and more.

As always, there’s something for everybody!

Ahead of the long holiday weekend the market had yet another good week. The S&P 500 gained 1.75%, the Dow rallied 1.5%, and the Nasdaq rose another 1.9%.

This week in an attempt to diversify the portfolio we are adding an energy play.

Last week was a split tape, with the big-cap indexes continuing their thrust higher, though the broad market remains a soft spot. Overall, the intermediate-term trend is effectively neutral, and we think what happens from here will tell the tale, with further strength indicating that a year-end rally is underway, though should the broad market infect the leadership, all bets are off. Right now, we’re more optimistic than not, but are simply looking for more confirmation on the upside—we’ll leave our Market Monitor at a level 5.

We think the most bullish thing the market has going for it is the action of individual stocks, a good number of which are beginning to percolate. Our Top Pick definitely quacks like a liquid leading name.

The market keeps improving but is not necessarily back to 2021 or even June and July 2023 levels just yet, as many individual stocks are stuck in neutral. Fortunately, that’s not the case in the Stock of the Week portfolio, as eight of our holdings are hitting either 52-week or all-time highs! Today, we try and strike while the iron is hot – or at least warming – by adding a familiar growth stock that was a market darling during Covid, had a very rough 2022, but has now gotten the attention of Mike Cintolo in Cabot Top Ten Trader after a major gap up at the end of October.

Details inside.

This note includes the Catalyst Report, a summary of the December edition of the Cabot Turnaround Letter, which was published on Wednesday, and earnings from Duluth Holdings (DLTH).

I hope you’ve been having a good holiday season and are looking forward to a New Year. I know I am, especially considering the rough year for the stock market. It’s time to move on!

Another year is coming to an end. It was a crummy year for the market. The current roughly -20% YTD return for the S&P 500 with two days left marks the worst yearly performance for the market since 2008.


Although it’s been a tough year for stocks, history strongly suggests that 2023 should be a lot better. In the last 42 years, there have only been 7 calendar years of negative market returns and 35 years of positive returns. Of those 7 negative years, 5 were followed by years when the market rebounded at least 20%.

For most people, investing during a bear market is a frustrating experience. Share prices keep going down, profitable positions erode in value, new purchases become money-losers. Short upward bursts in market sentiment bring hope for a new bull market, but these fade quickly. The temptation is to sell everything and wait for better times.

I hope you’re having a wonderful holiday week. I celebrated Christmas with my wife and kids (Gracie-7 and Tripp-4), as well as my parents and in-laws. I’m lucky because we all live in the Boston area – so travel was minimal. We enjoyed tons of good food and wine.

This week there were no earnings reports, so most of the note and podcast cover relevant news on our recommended companies.

After a decent bounce yesterday, the market is coming undone today after a couple of poor earnings reports and a continuation of the general malaise out there.

Portfolio Changes: Infineon Technologies (IFNNY): FROM BUY A HALF TO HOLD


Centrus Energy (LEU) shares were up a point this week but the Zacks Consensus Estimate for its current-year earnings has been revised 21% downward over the last 60 days. This is still a buy for aggressive investors as interest in expanding nuclear power gains momentum.

Small-cap stocks continue to trade in the same 5% range that they’ve been in for the last month. On the S&P 600 Small Cap Index that translates to a range of 1,184 – 1,252. At the low end of that range we have the upward sloping 50-day line.

This year stunk. Next year should be better. Remember that if the market falls to a new low early next year.

There are some very good reasons to believe the market will turn around in 2023. Stocks trend higher over time. The average bear market lasts around 15 months. This one is almost a year old. Of the seven negative-returning calendar years for the market since 1980, five were followed by years of returns of over 20%.

Well, December has been a drag.

No Santa Claus rally.

And my New England Patriots look awful.

With the Patriots’ comically bad loss to the Raiders on Sunday night, they aren’t mathematically eliminated from the playoffs. But they effectively are.

It’s really the holiday season now. This time of year, investors stop paying attention to the market, like during the last days of the summer. That means, in the absence of game-changing headlines, stocks probably won’t do much of anything until the rubber hits the road after New Year’s.


When sobered up investors take a fresh look at stocks in January what will they see? They’ll see what they saw before they stopped paying attention, a lot of uncertainty.

WHAT TO DO NOW: The market has been doing fairly well of late, so much so that our Cabot Tides are on the verge of a green light. That said, individual stocks remain hit or miss at best; we had one gap up strongly yesterday, but today, Wolfspeed (WOLF) is disintegrating after earnings—we’re forced to sell our half-sized position today. Details below—and we’ll have far more in tonight’s regular update.

I will be exiting the Mastercard (MA) trade today. I will discuss the trade in greater detail in our subscriber-exclusive webinar at noon ET tomorrow, October 28.

As discussed in our weekly issue and on our weekly call, I will be taking a position in Mastercard (MA) today.

SPY has moved significantly higher over the past few weeks. As a result, I’ve decided to take my SPY November 18, 2022 325/320 bear call spread off the table for a profit. Some may choose to hold on to the trade, just remember, we still have 24 days left until expiration and lots can happen over that timeframe.

As part of the Income Wheel approach, we allowed our Coca-Cola (KO) calls to expire out of the money at expiration last week. As a result, our calls expired worthless and we reaped the entire premium.

After allowing our DBC October calls to expire worthless, we need to sell more premium against our DBC calls, this time for the December expiration cycle.

The Cabot Profit Booster portfolio has three positions set to expire this afternoon. My plan is to simply let these calls expire, and then we will evaluate where we stand with the stocks come Monday/Tuesday morning, depending on market conditions.

Our BITO 14 calls for the October 21, 2022, expiration cycle are essentially worthless. Same goes for our GDX 26 calls.

CVX jumped over the past two days. As a result, we need to roll our October 21 calls into November. The jump in the stock has pushed our return to upwards of 35%, while the underlying stock is sitting at a 7.0% gain since we added it to the portfolio.

We still have our DBC and CVX positions on for the October 21 expiration cycle. I intend to hold on to both and monitor how each performs as we lead up to the end of the October expiration cycle. As it stands, there is a good chance I will allow both to expire worthless and sell more call premium early next week. But as always, the price action over the coming days will dictate how we handle each position.

I will be exiting the American Express (AXP) trade today. I will discuss the trade in greater detail in our subscriber-exclusive webinar at noon ET today, October 21. Register here.

As discussed in our weekly issue last week, and on our weekly call, I will be taking a position in American Express (AXP) today.

Our Cabot Top Ten Trader’s market timing system consists of two parts—one based on the action of three select, growth-oriented market indexes, and the other based on the action of the fast-moving stocks Cabot Top Ten features.