I'm not going to sugar coat it. There are numerous stocks and sectors that are hanging on the precipice that look like a small push could send their shares tumbling into a deep abyss. The Regional Banking Sector is one of these sectors. A quick scan across the landscape reveals a tornado of broken charts. And as one would expect, volatility is elevated across the board here and offers great edge to net options sellers. 

A retail stock which earlier this year showed tremendous promise breaking out of a FIFTEEN YEAR base has faltered. And any regular reader of All Star Charts knows we're fans of the, "from failed moves come fast moves" phenomenon. In short, if a stock breaks out of an obvious pattern, sucks everyone in, then can't hold its breakout and reverses? Well, oftentimes the moves in the opposite direction can be doubly vicious.

The stock we've identified has reversed hard off all-time highs over the past four weeks, but it looks like the bad news may only be getting started. Friday's close left the stock's chart hanging on a precipice. We're thinking we'd like to give it a little nudge and see how hard it will fall.

How do you feel about a little buy-the-dip action in the crude oil space? Given that there's juicy options premiums to sell into here, it is certainly worth a discussion.

It has been quite a one-way ride lower for crude since early October, but the All Star Charts team may have noticed something that might make it worthwhile to dip our toes into these slightly contaminated waters:

In addition to improvements in sentiment, we’re seeing bullish momentum divergences being formed and/or confirmed across the board in the Energy Commodities themselves, as well as their corresponding US Equity Sectors.

This not only signals some potential exhaustion on the side of sellers, but more importantly, it allows us to define our risk on the long side which we haven’t been able to do since prices broke back below their July highs.

We're gonna throw an idea out there for the bulls. They aren't dead yet, apparently. And we don't need to look too far before we come across the healthcare sector and stocks like Pfizer $PFE and UnitedHealth Group $UNH that are at or near all-time highs.

During our recent All Star Options conference call, JC brought our attention to this sector and it definitely caught my attention. With the broader markets kind of "stuck in the muck" right now -- not really offering any clear indication of the next major move -- we might as well add some long exposure against a current portfolio of delta neutral and bearish open positions to help give us some balance.

The best idea on the table right now looks like $UNH. Here's how we're going to play it without risking too much...

A common theme discussed in this month's All Star Options conference call was the fact that many sectors, commodities, and stocks were in "messy" or "sloppy" sideways holding patterns right now. The selloff that began for stocks in early October and bled into early November seems to have abated somewhat for the time being, leaving many stocks with terrible looking charts offering no clues on direction.

But the price action has not been limited to just stocks -- bonds and commodities too all seem to be lost in the muck right now.

This might frustrate some, but these types of environments can be wonderful for delta neutral income strategies. And Gold $GLD is a perfect example of an instrument showing little commitment to any up or down directional movement.

This is the video recording of the December 2018 Conference Call for Members of All Star Options

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.

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.

Ok, I'm on an airplane on my way to San Francisco to present at a conference and to hang with our boy JC, so please forgive the liberties I took with the title of this trade plan. Clearly I'm showing my age...

But seriously, the materials sector is offering us some nice premium to put a fast income trade on into the holidays.

Honestly, I never thought a uranium play was something that would ever come across my desk, but a week ago JC published a piece highlighting the uranium space as displaying bullish turnaround characteristics -- which offers a nice portfolio diversification to many of us who are mostly positioning for the downside in equities right now.

As I've let this idea marinate in my head over the last week while watching declining volatility make long options more attractive, I've really warmed up to the risk/reward profile in this space and have identified a great way to position for exponential gains in the Global Uranium ETF $URA.

It's been quite a bounce in the markets since the end of October. And we expect to see many more such bounces in the days and weeks ahead as market participants battle to find equilibrium in a tape that has definitely been thrown off balance since early October's swoon. The thing is, our bet is that we'll see even more impressive bounces -- but from lower levels.

Our new regime thesis hasn't changed (yet), and as such, we view any bounces as great opportunities to establish new short positions in the weakest names in the market. And one of those weak names that we've been stalking is JP Morgan $JPM.

One of the beauties of options trading is even when we don't have the highest conviction in a trade, we can still participate by lowering or shifting our risks.  I come from the school that says spread your bets out across the market -- small -- because the constant pursuit of edges will yield results over the long run as long as no bad individual trades are too big to take us out.

In our most recent monthly All Star Options Conference call, we highlighted a desire to play for a bounce in bonds. In the days since, the market gods are either taunting us, or smiling on us -- offering better entry levels.