Evidence Beyond Positive Thinking

The issue as to whether plenty of materials, steels, mining plays are on the cusp of another sustained move higher off possible bear market lows printed roughly one year ago is slowly resolving in favor of bulls.

Beyond a mere whim or knee-jerk reaction to President Trump's rhetoric and policies, we are looking to stay rigorous and assess whether the price action aligns with that thesis. Moreover, in addition to some prominent material miners like BHP FCX RIO VALE, we also want to see if participation broadens out to virtually all things commodities and miners. 

With this in mind, seeing a name like Allegheny Technologies, symbolic of western Pennsylvania's steel and specialty materials producing tradition, surge 20% higher this morning after earnings is certainly an encouraging sign. 

But a single session does a new trend make. Thus, context is critical. And when we put the move into context, it lends itself to the idea of a new, meaningful leg higher now set in motion.

Specifically, the daily and monthly charts, respectively below, show ATI breaking multi-quarter resistance on this earnings move. And the cherry on top is that the light blue line at roughly $18 stretches all the way back to the 2008 crash lows.

Indeed, recapturing and holding above those prior major lows is critical for bulls to avoid the stigma of ATI being dead money for years to come, at a bare minimum.

Seeing the ags, uranium, rare earths, and some other niche parts of the materials and mining space adds credence to the notion of a broad-based bull run in progress.