Christmas Market

With some of the fear and indecision regarding political and monetary headlines abating today, the major averages are back in the green as I write this.

Indeed, the small cap bullish divergence we noted with Members this morning continued to play out and likely turned the tables on shorts and volatility longs who were pressing for a complete giveback of yesterday's explosive rally. 

While the market still has much more to prove, insofar as serving up concrete evidence that we are in the midst of a fresh, sustained uptrend, there is no denying that to follow-up a huge rally yesterday with a red-to-green move today is another step in the right direction for bulls seeking that traditional holiday season rally. 

Another overlooked aspect about this correction is that names which essentially locked out patient longs for months, even quarters, on end, are finally giving lower risk entries for traders who can respect a preset protective stop-loss. And then the emerging leaders like ETSY TTD TWLO are all acting brilliantly, another feather in the bulls' cap in terms of trying to prove a fresh uptrend is underway. 

But as far as names we have been patient with, Evolent Healthcare has the hallmarks of an emerging leader given its strong position with the transition to value based payments. EVH has been a strong, stealth performer for most of 2018. 

As you can see on its weekly chart, below, the stock is not far from all-time highs and figures to be in prime position to explode to a multi-year breakout if the broad market continues to improve.