It's the holiday season here in America and stocks are in a downtrend, or sideways trend at best. What does that mean for us as investors?

Welcome back! Thanksgiving week is past us and now we can focus on finishing out 2018 strong.

We don't feel like the market is setting up for any type of major bounce or reversal here or any time soon. We also are cognizant of the fact that US stocks have fallen a good way since early October and the risk for further downside from here is very high. However, you may accuse me of being sentimental, but the optimist in me doesn't think we will see any further scary downside from here through the Christmas/NYE holidays. May we break correction lows? Yes. But I don't expect any major dislocations before 2019. Of course, I've been wrong before and I'll happily eat humble pie again if I'm wrong here.

Either way, whether markets have another slide or if we just coast into the new year, it feels to me the Utilities space is a good place to hang out and collect some premium.

During our members-only conference call and our trade management post we discussed why a more neutral approach is best as we identify whether equities are going to consolidate at higher levels or begin to roll over again. We also discussed the importance of taking some profits quickly in an environment that produces whipsaws in both directions.

Over the last two weeks we've seen a number of our long ideas failing and more of our short ideas working, suggesting that lower prices are likely ahead in the short-term and that we should continue to err on the short side of stocks. This post will outline some of the evidence we're seeing supporting this thesis, as well as adding a number of short ideas to our trade list from October and November.

Over the years I've been asked this question a lot: "What do I do? Should I sell now?"

This is often accompanied by a story about how they bought a stock or asset and it went down in price instead of up. The blame usually goes to a financial advisor or local friend who gave them "the tip". They entered into the position without a plan and now they don't know what to do with their unrealized losses.

Happy Thanksgiving!

During our family's feast this year I'll be reflecting on my gratitude to each and every one of our subscribers, and to my team here at All Star Charts. I could not ask for a more engaged audience and a more top-notch group of analysts to work with. This year marks the maiden voyage of the All Star Options corner of the All Star Charts platform and the response from institutional and retail subscribers has exceeded my expectations and it makes me ever more motivated to continue crushing it for years to come for all of you.

Sincerely, thank you.

Now let's talk business...

This week we put an options spread trade on in Goldman Sachs $GS and it serves as a vivid reminder that we're not looking for perfection here. We're looking to follow a process.

I'm on the east coast this week for the Thanksgiving holiday so I came into the city to say hi to friends. Catherine Murray and I had a nice conversation on BNN Bloomberg about US Stocks, Interest Rates and what Credit Spreads are suggesting for overall risk appetite from institutions.

Here is the video in full:

On October 30th we got more constructive on Indian stocks and put out a massive post with stocks to buy. Given that many of these trades were counter-trend in nature, we expanded on our last trade management post during this month's conference call, discussing strategies that are helpful to know in any environment.

We could not be more thrilled to see stocks selling off. There has been more than enough evidence since the beginning of October to suggest that a more neutral approach to markets and/or selling stocks short has been the best course of action. Passive investing is great, in theory, but markets like this remind everyone that hope is not a strategy. We need to weigh the evidence as it comes in and always reevaluate our thesis.

Over the past couple of years you'd have a hard time finding a bigger US Stock Market bull that me. There was no reason not to be incredibly constructive towards equities. Leaders were leading, consolidations were resolving to the upside and the trends globally were up. We didn't think it made any sense whatsoever to fight that trend, while many others did. Top callers were horribly wrong for a long time. 

From the desk of Tom Bruni @BruniCharting

While updating our Canadian Chartbooks this weekend, I noticed a few that stood out as offering well-defined opportunities where the reward/risk is skewed in our favor. This short post will outline these names and levels, but members can view all of our Canadian Universe by clicking here.

There aren't many stocks in Canada hitting all-time highs right now, but Rogers Communications is one of them. It's a leading stock in a strong sector, so as long as it's above 68.70, we want to be long with an upside objective of 95.25.

Click on chart to enlarge view.

There are still a lot of weak stocks out there that continue to show signs of worsening -- especially when they lag during every bounce attempt by the broader indexes. Goldman Sachs $GS is one of them. Goldman has been one of the stocks we've wanted to be short since mid October but the stock kept moving back in forth around our line in the sand -- $218 -- frustrating our attempts to pick a spot.

Last week, $GS finally made what feels like a decisive move to the downside and now is the time to strike.

From the desk of Tom Bruni @BruniCharting

Over the last few weeks we've looked at signs of rising stress in the credit market, interesting relative strength in bond prices, and a trade on the long side in treasury bonds, but today I want to take a comprehensive look at the bond market and highlight what it's signaling for rates and risk appetite in general.

When we want to see what the market is doing on a given day, we all have our list of the ticker symbols we punch in: $DJIA or $SPY or $QQQ. Some people are more global and look at things like Gold, Crude Oil or Interest Rates and countries like Japanese or German Indexes. I talk to guys and gals who tell me the Russell2000 is the market for them. We're all different. The point is to be true to who you are and act accordingly.

I get asked a lot what that list is for me. The way I interpret this question is, “What are the 15 ticker symbols I punch into my charting software to see what the market did or is doing at any point during the day or night?”.