[isatrader]

A major part of the Stan Weinstein's Stage Analysis method is finding stocks that are showing the best relative strength versus the market.

This is especially important to start thinking about when the market indexes are in Stage 4 like they are currently, as the stocks showing the best relative strength during a market Stage 4 will often become the new leaders when the market eventually finds it's bottom. As while the indexes bounce around their lows, these new leaders will be breaking out into Stage 2 and to new highs.

The indexes lag individual stocks, as they are just an average of the stocks within them. And so contrary to what you might believe about the method. In order to get into those new leaders. We'll need to start dipping our toes into some A+ looking Stage 2A breakouts when the market are still in late Stage 4 or starting to show signs of a Stage 1 base forming.

This is particularly difficult to get right, but we should start to get some clues from the various market breadth indicators when the time is right. Which may be soon, or it may be a long while away yet.

But in the mean time I wanted to start a discussion to get people thinking and looking where the relative strength is occurring and also sector themes that we think might emerge from this crisis as the big winners and become the new leaders. For example technology stocks that enable people to work remotely have been getting traction so far. Also, supermarkets shelves are forever empty; online media providers are likely getting many more signups etc.

So where are the strongest themes going to be once this crisis is over? Or if you like shorting during a Stage 4 bear market, then what sectors are going to suffer the most in a prolonged Stage 4?

So following on from this post. Here's a few stocks that benefit from people working from home, and generally being at home that have been showing excellent relative strength during the crisis - AMZN, DOCU, MSFT, NFLX, TEAM, WORK, ZM - which is one potential theme that could continue to do well after the crisis. As a lot more people could be working from home regularly going forward with all the new systems and processes that have been put in by companies to enable it recently.

So am adding these to my recovery watchlist to keep an eye on. The theme with these is work from home. So what other themes could emerge?