Last week we outlined our thesis for a lower low in Indian stocks, as well as what it would take for us to get more aggressive on the long side.

After another sharp move lower with dramatic blowups in  Yes Bank and Crude Oil, let's revisit that thesis and discuss why patience remains the best course of action given current conditions.

From the desk of Steve Strazza @Sstrazza

New Mystery Chart!

For those new to the exercise, we take a chart of interest and remove the x/y-axes and any other labels that would help identify it. The chart can be any security in any asset class on any timeframe on an absolute or relative basis. Maybe it’s a custom index or inverted, who knows!

We do all this to put aside the biases we have associated with this specific security/the market and come to a conclusion based solely on price.

You can guess what it is if you must, but the real value comes from sharing what you would do right now. Buy, Sell, or Do Nothing?

Yesterday, $VIX printed the highest level we've seen since the financial crisis in 2008. That's a twelve year high.

It exceeded the "government shutdown" spike of 2011, the Chinese stock market scare of 2015, the 2016 election fear mongering, and the Brexit noise.

Editors note: The chart police (aka, JC) would like me to point out that this is a weekly chart and the last bar on this graph is not complete. The horror!

We can point to a couple big reasons why volatility is spiking (Coronavirus, oil crashing) and a few smaller ones (we're overdue, debt, whatever....). But none of that really matters. Only price pays, right @Alphatrends?

You come to All Star Options for options trade ideas. But you also come to ASO for responsible risk management and strategy selection. Here's my thoughts now (subject to change as new information presents itself) for the next few weeks.

From the desk of Steve Strazza @Sstrazza

In this report, we cover our Coronavirus Custom Index which is comprised of stocks we believe benefit from the coronavirus as well as a playbook to profit from these strong performers. 

To be clear, we didn’t find these stocks looking for coronavirus plays, we found these through our ordinary process of scanning for relative strength. We were simply looking for stocks that have been bucking the trend during the recent selloff. With that said, it was hard to ignore the results when we thought about what these companies do.

Here is our All Star Charts Coronavirus Custom Index making higher highs and higher lows recently while the broader market squanders near bear market territory.

Volatility spiked over the weekend. Here are some thoughts.

From the desk of Tom Bruni @BruniCharting

There's been an ag-gravating pattern of behavior torturing bulls in the Agricultural Commodity space, so this educational piece will highlight the conditions that got us here and also outline a new trade idea.

This is the big question going through the minds of market participants all over the world right now. What's next? Have we seen the worst of it? Or is this just the eye of the storm?

I remember as a kid I was 10 years old when a huge storm hit Miami. Hurricane Andrew was a massive category 5 storm that was supposed to hit Orlando but in the middle of the night changed directions and decided to make a beeline towards my house. So the eye of the storm actually went over our heads:

Things are whippy out there. And volatility is elevated to levels we haven't seen in quite a while. This is no time to be a hero. This is the time to focus on edges and putting them to your advantage.

I know it's sexy to be a buyer of calls if you want to be the hero bottom caller. Similarly, it's equally sexy to be a holder of long puts into a market crash. But this is not the time to be initiating new long calls or puts positions. The premiums you'd pay are so high right now that you could totally nail the direction, but you'd be swimming upstream against an eventual mean-version in volatility pricing.

But this does not mean we pick up our ball and go home. We options traders have options!

In this environment, we're looking for plays where we are net sellers of premium. With premiums this juicy, it would be irresponsible to do anything else.

Yes Bank is in the news again and following an 83% intraday move to the downside, market participants are wondering what's next?

In this post, we'll outline why this week's move is business as usual for the stock, what we'd do with it now, and why the best trade in Yes Bank may be to avoid it altogether.

The current market environment remains choppy, so we want to revisit a sector that's showing relative strength, Pharma.

In November we pointed to the improving prospects of the Nifty Pharma Index and its components, following up with additional trades in January.

Today, we want to revisit the sector to see what's changed and what stocks we want to be buying and selling.

First, let's start with the Nifty Pharma vs Nifty 500 ratio chart that continues to turn higher after meeting our downside objective late last year. This continues to suggest further outperformance from the Nifty Pharma sector relative to the broader market.

Click on chart to enlarge view. 

Looking at the Nifty Pharma Index on an absolute basis is where things get a bit tricky. Prices confirmed...

From the desk of Steve Strazza @Sstrazza

Thanks to the handful of you for playing and entertaining this week’s Mystery Chart.

My apologies if this one was a bit of a layup, but that was the point. You were all buyers and so are we. Since we're all in agreement let’s dive right in and talk about why we’re bullish on this chart but more importantly, why it matters.

Two weeks ago we wrote about the underlying weakness of the Nifty IT Sector, but today we're highlighting a stock in the space that continues to show relative strength in the face of a weak market.