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On the Old Wall TV, you’ll almost always hear a commentator talk about “good” or “bad” financial market data.

But good and bad relative to what? Absolutes don’t matter without additional context. It’s all about the rate of change.

As Hedgeye CEO Keith McCullough explains in the clip above, you want to get long a stock when its numbers start to get “less worse.” Conversely, you want to consider shorting a stock when its numbers start to slow.

“Take Slack (WORK) for example,” McCullough explains. “They used to have 90-plus percent growth. Today that number is 44. And 44 is not 90. It’s positively absolute, but absolutes don’t matter. It’s the rate of change… That’s why a lot of names like Autodesk and Slack are getting crushed. People think these companies are ‘secular growers’ that don’t have to deal with the cycle.”

Watch the full clip above for more.

McCullough: Absolutes Don't Matter - Rate Of Change Does - the macro show