The majority of my current open positions are long-biased. If the market continues to rise, I expect many of these positions to keep working for me.

My few short-delta positions are on the verge of stopping me out for a loss. They were put on as portfolio hedges against all my long exposure. So in a way, I’m happy they haven’t worked out.

That’s the thing about hedges. I don’t really want them to work. Because that means the positions I really want to work likely just got whacked.

Ok, so my hedges aren’t making me money and my long positions are. What else can I do to lock in gains and minimize the potential for giving back a lot of open profits?

Today's trade is in a name that doesn't need Wall Street.

They crush their little corner of the world, operating in the midwest. They do not need to raise money or any exotic financing. Because of this, the company is completely off Wall Street's radar. This means very few (if any?) analysts cover it. Nobody is publishing research reports on it. Essentially, there just isn't anyone talking about it.

Around here, we call these "Eddy Elfenbein stocks." Stocks that are steady dividend payers, operating excellently in obscurity, providing a product or service that so many people use that they don't even realize they are using it.

On today's Flow Show, me and Steve Strazza put our heads together to follow the wave into the Steel sector.

Sector trends are showing us where capital is flowing and that led us to a trade idea in steel manufacturing company Reliance Inc $RS.

Here's the chart highlighting a high consolidation that often portends to rapid near term price acceleration:

So we're going to fix that.

And here's why:

It’s the perfect environment to buy mining stocks following gold’s breakout.

The plan is simple: Buy the strongest names on absolute and relative terms – if and when they trade above our risk levels.

That is from my Commodities Analyst Ian Cully in a recent post about the Gold sector.

Today's trade is in a mining name that is above the risk levels, signaling its time to get involved.

I received a great, and well-meaning question from a new All Star Options subscriber about a recent trade we entered in $VLO that offers a great lesson or reminder to those who need it.

Question:

What are your thoughts on when the value of your options hits a 50% gain in one day? The September 175 calls for VLO I purchased hit +48% yesterday. Do you trim/roll/close with such a quick gain? I understand this is more of a personal preference as it relates to what you want to make on a trade, but if you hold those 48% increases, they could eventually increase to +150%!

He kinda answers his own question in the end, but here is my response:

One sector that I feel a bit underexposed to right now is real estate -- particularly REITs. And when a dominant player in New York City's commercial real estate sector pops up in our scans with a beautiful chart, it feels to me like this one might be set to surprise a lot of people.

Every once in a while, I’ll put on what I call “all or nothing” trades.

What this means in practice is that I’ll put on a defined risk options trade knowing full well that the trade is either going to net a profit, or it’s going to be a zero – a full loss of invested capital. There’s no in-between.

Usually, this happens because I love a setup, but the price level on the chart that would invalidate my thesis is pretty far away. If we get there, it’s more than likely that whatever premium I paid to enter the trade will have nearly evaporated. There will be nothing left to sell, even if I want to.

Two trades with March expiration options have concluded for me this week that demonstrate the yin and yang of these types of trades.

On Feb. 14, I put on a bearish bet in Hormel Foods $HRL. I bought the March 25 puts for 15 cents. This trade was put on at a time when I was looking to add some bearish exposure to my portfolio to help balance out the heavy long exposure I had in other positions.

Here’s what I said about it at the time:

Steve Strazza and I hosted another Flow Show today on Stock Market TV and discussed opportunities in the Biotech space.

Starting at an index level, we see that biotechs are clearing a base and appear set on breaking out:

Today's trade is a bet on the speculative juices continuing to flow through the summer. This stock has been performing fantastically since the November stock market explosion, but if we're a believer that this stock is simply tracing out the right side of a larger base, then we've still got plenty of upside to go.

Here's a chart of DoorDash $DASH:

Today's trade is in a name that has the potential to really rip. Of course, the nature of this type of trade is that it has a lower probability of success.

But if we get it right, our potential gains will likely be exponentially higher than any heat we're likely to take in this trade if we're early or wrong.

So let's get right to it.

I’m reading Annie Duke’s latest book “Quit: The Power of Knowing When to Walk Away.” Though I’m only about halfway through it I can already confidently recommend this book to traders.

The book isn’t addressed to traders, though it frequently references our profession in its anecdotes and many of the stories are very relatable.

And it certainly has me thinking about better ways to decide to quit a trade, quit a strategy, or quit a product.

I frequently go down rabbit holes, experimenting with models to extract consistent, repeatable, acceptably risk-adjusted returns via index options. I’ve written about my near-constant obsession with this project numerous times. It continues.

As a trader, it's always good to be working on some kind of “side hustle.” In our cases, this is more likely to look like building a new strategy, fine-tuning a scanning method, or constructing a money management scheme that can propel us into becoming more profitable traders.

This morning, my Head Technical Analyst Steve Strazza joined me on The Flow Show to put our heads together on a new trade:

Strazza loves the Energy sector here, and of all the charts he likes, I liked this one in Valero Energy $VLO the best:

Best of all, options premiums are near the lowest levels of the year for $VLO: