The market has been exceptionally strong. The Nasdaq and the S&P made new all-time highs first, followed by a huge breakout in Bitcoin. There are many sectors and areas making new all-time highs, but what about the ones that aren’t? I think there’s a nice catch-up trade shaping up in the laggards. My good friend Sam Gatlin over at AllStarCharts, said it best. 

The Mag 7 Laggards

The Mag 7 are seen as the most important stocks in the stock market. These are the biggest companies in the world, and are all household names at this point. Within the Mag 7, you have the Lag 3. These three stocks are the reason why the $MAGS ( ▲ 0.4% ) ETF has not made new all-time highs yet. In my opinion, there is tons of potential for rotation into these beaten down tech giants. Here’s a composite I made attached with the volatility compression indicator. These stocks are coiling right at the all-time high anchored vwap, and there is likely a very large move on the way in the coming weeks. Even though I drew arrows in both directions, I think this move is likely to the upside.

Interest Rate Sensitive Groups

With interest rates being the highest they’ve been in years, these areas of the market have been the toughest to buy. Recently, these stocks have been looking very appealing. I can’t say if this gives an outlook on rates in the future, but I can say that I am looking for stocks to buy in these groups. I made a composite with the most interest rate sensitive ETFs, and they have managed to break above the 61.8% Fibonacci retracement level while reaching overbought momentum or RSI. This is a very bullish development for these stocks, and I think they are likely heading to their former all-time highs.

Crypto Laggards

With Bitcoin breaking to new highs, there are tons of cryptos that are looking to join the party. Between Ethereum, Solana, and XRP, $XRP.X ( ▼ 10.83% ) is currently my favorite catch up trade. It has recently broken above its all-time high anchored vwap, and is close to completing a failed breakdown relative to Bitcoin.

Conclusion

Right now we can continue to buy the leaders, or look to the laggards for catch up opportunity. This can be a very tough decision, so why not do a little of both? This is how I’m looking to play the next phase of this bull market, and I’d be interested to know how you are playing it. Feel free to reach out and let me know your thoughts. As always, thank you for reading and blessings to all!

Follow me on Twitter/X @TheDonInvesting

Bonus Chart

If I had to pick one setup with the best catch up potential, it has to be Tesla $TSLA ( ▲ 0.14% ) . As long as Elon shuts up, the natural volatility in this name could make for a huge winner.