Are you actually adapting to this market? Or are you still running the same playbook that worked a year or two ago?
I ask myself that constantly.
Are we positioning for what’s likely to drive returns three, six, nine months from now?
Or are we stuck recycling the same sectors and strategies from earlier in the cycle, hoping they start working again?
In a bull market, you do not get paid for nostalgia. You get paid for being early to the next area of leadership.
That’s the whole point of the monthly candlesticks we were talking about this weekend.
They force us to zoom out, strip away the noise, and identify where structural breakouts are happening across asset classes and market caps.
The goal is simple: to build a framework that keeps us on offense and aligned with the trends that are expanding, not the ones that already had their run.
This is still a bull market. So we’re not looking to hide.
We’re looking for leadership.
If You Drop It on Your Foot and It Hurts? Buy It!
There are certain markets where you want to own the hard stuff.
I came up in this business in the 2000s, when the leadership was simple. If you could drop it on your foot and it hurt, you wanted to be long.
Steel. Copper. Aluminum. The things people dig out of the ground and turn into something else.
That old rule of thumb is coming back into play. Materials aren’t just participating. They’re leading.
Large-cap, mid-cap and small-cap materials all just closed the month at new all-time highs.
That’s not one ETF getting dragged higher. That’s broad-based strength across the entire group:
The S&P 500 Materials Index Fund (XLB) is up 17.7% so far in 2026. The S&P 400 Mid-Cap Materials Index is up more than 14%. The S&P Small-Cap Materials Index Fund (PSCM) is up more than 18% this year.
That’s leadership. And it’s happening in a sector that barely shows up in the major benchmarks.
Materials make up just 1.7% of the S&P 500 and only 1.1% of the Nasdaq 100. Even in the Mid-Cap 400 they’re just 4%, and about 5% in the Small-Cap 600.
So if you want exposure to this group, you have to go in and get it.
Copper > Gold
You all saw what gold did last year. After years of going nowhere, it broke out of a massive base and went vertical.
For a lot of newer investors, it was their first real experience with a structural metals breakout.
For those of us who traded through the 2000s, it felt familiar.
We were happy to participate on the long side in gold and silver. When something resolves higher from a decade-long base, you don’t overthink it.
But leadership rotates. And now our attention is shifting.
If you study what gold did after its breakout, you’ll notice the sequence.
Tight base. Expansion in momentum. Then an acceleration phase as new buyers were forced in.
Copper is setting up in a similar way:
They’re not the same metal. Gold is monetary. Copper is industrial. Copper shows up when people are building, wiring, expanding, constructing.
And look around.
Railroads are making new highs. Truckers are breaking out. Shippers are moving. That doesn’t happen in an economy that’s standing still.
Things are being moved. Things are being built. And when that’s happening, you want to own the inputs.
Gold had its run. Now it is copper’s turn.
In a bull market, you don’t just own the story.
You own the things that make the story possible.
Stay sharp,
JC Parets, CMT
Founder, TrendLabs