From the desk of Steve Strazza @Sstrazza and Alfonso Depablos @AlfCharts
Our International Hall of Famers list is composed of the 100 largest US-listed international stocks, or ADRs.
We’ve also sprinkled in some of the largest ADRs from countries that did not make the market cap cut.
These stocks range from some well-known mega-cap multinationals such as Toyota Motor and Royal Dutch Shell to some large-cap global disruptors such as Sea Ltd and Shopify.
It’s got all the big names and more–but only those that are based outside the US. You can find all the largest US stocks on our original Hall of Famers list.
The beauty of these scans is really in their simplicity.
We take the largest names each week and then apply technical filters in a way that the strongest stocks with the most momentum rise to the top.
Based on the market environment, we can also flip the scan on its head and filter for weakness.
Let’s dive in and take a look at some of the most important stocks from around the world.
As I and the team have discussed on The Morning Show and this week's Options Jam Session, I'm on the hunt for opportunities to sell delta-neutral option premium with $VIX exploring higher levels than we've seen in recent months.
Today's trade is in a sector ETF exhibiting elevated options premiums and signs for extended rangebound action.
And October options are offering us enough premiums to trade strikes sufficiently far away from current action, beyond significant support and resistance levels.
As far as setups for delta-neutral premium collection go, this one checks all the boxes.
Inflation worries, higher yields, and the dollar rising typically spells trouble for equities.
I mentioned in the Live Trading Room yesterday that if the S&P 500 breaks 4,400 we can see 4,370. An overbought market can stay overbought, and an oversold market can stay oversold.
This has been a slow bleed lower. It's not an easy market to trade, so I tell people to back away or trade very small.
The strategies that worked in the first 6 months are not working well in this environment. But the strategies that did NOT work in the first half of the year are much better in the current market.
For example, high volatility strategies were mostly terrible in the first half of the year. That's because we were in a low volatility environment. It was our low vol strategies that worked great for us.
So since the market is behaving differently now, then so are we.
Volatility is a little more elevated, so that means we're getting paid to play. That wasn't the case earlier this year.
Freeport McMoRan, for example, has some juicy premiums and is trading in a massive range.
These are the registration details for our LIVE Mid-month Conference Call for Premium Members of All Star Charts.
Our Live Call will be held on Wednesday August 23rd @ 6PM ET. As always, if you cannot make the call live, the video and slides will be archived and published here along with every other live call since 2015.
A reader recently reached out to me, asking about a trade I put on.
I’m paraphrasing, but the conversation went something like this:
Reader: “The implied volatility of the MSTR June 450 calls is 64.7%. That is far from cheap, no?”
Me: “The absolute number of implied volatility is meaningless to me. I’m paying attention to its relative value. I want to know where IV is now compared to where it’s been.”
Reader: “Wow. That amazes me. I always thought the implied volatility was an indication of how expensive an option was. Could you write an educational piece on this sometime please?”
Dear reader, your wish is my command.
Here’s the thing about options premiums (and implied volatility, or “IV,” which measures premiums) – they mean revert.
When IV spikes, it’s only a matter of time before it comes back down. And when IV is low, it’s likely that any sudden premium moves will be to the upside, not the downside.