The True Alphas Are More Reserved Than You Think

One of the more interesting aspects about our modern age of social media is that many tend to view loud, unrestrained, obnoxious behavior as being "alpha" and dominant. While there may be some instances where that holds true, the essence of the true alpha often focuses on highly selective aggression, even benevolent at times. In other words, showing restraint seems to be a lost art these days.

Applied to the current market, you simply cannot blame dip-buyers and newly-minted options splashers for continuing to probe every little blip in some of the more prominent large cap tech names. It is interesting to note, however, that shares of Amazon have been weak and lagging the broad market since Monday's reversal lower. True, AMZN has seen an incredible rally since the March lows, if not the last five years or so. And a breather is entirely reasonable. 

But, frankly, my interest is more focused on how the broad market acts should be see AMZN deepen its pullback to, say, $2800, and, you might want to grimace and cover your ears on this one, actually lose that level for a few weeks and shake out a chunk of longs even as the bull case for the stock and company remains nearly bulletproof. Moreover, TSLA is back under $1500 this morning, a near-term line in the sand we have been noting both here and with Members as a tell regarding the Nasdaq for now. Naturally, NFLX earnings tonight may dictate how we trade on Friday into the summer weekend.

However, as far as the reserved alphas are concerned, some natural gas-related energy plays, a segment of the market not many traders are even considering these days, looks to be displaying some strong, silent action.

On their respective daily charts, below, COG and RRC are both above their 200-day moving averages, which is a claim the overwhelmingly majority of other energy charts cannot make.