I know. I know. China.

Anyone else tired of the headlines? Or are you like me and don't even pay attention?

Once again, all we do is follow price and let supply and demand lead us to opportunities. Leave the headlines to Johnny Piker.

So with that out of the way, lets take a look at an opportunity in the Chinese Internet sector.

JC recently published a piece highlighting the action in the Financials space:

Today we’re looking at Financials pushing up against their historic 2007 highs for the 3rd time.

The way I learned it was that the more times a level is tested the higher the likelihood that it breaks through. I don’t know if this is going to be it, or if it will take a 4th or a 5th test. But I do think there is a blog post coming soon where we’re looking at Financials at all-time price highs.

Meanwhile, on a total return basis, Financials are already making new all-time highs this week.

Looking at these charts, it is hard not to be enthusiastic about the potential for a major breakout in this sector:

We're seeing a pretty sexy opportunity set up in the auto space. <--- that's a sentence I never thought I'd write.

Even more sexy is the potential breakout could be from a nearly TWELVE YEAR BASE.  Mizutamari!!

Naturally, we want to go along for the ride.

This is the video recording of the November 2019 Conference Call for Members of All Star Options

There are bullish setups all over the place. My friend Aaron couldn't have said it better:

<----- drowning in setups

— Aaron (@ATMcharts) November 4, 2019

I agree. Lots to play on the upside. That said, lets not get crazy here. We still need to put ourselves in some high probability situations and not bet the farm on any one trade. So let's take a look at a good opportunity in that vein.

As I do at the end of every month, I scan across my portfolio of open positions and observe any positions which hold options nearing expiration in the upcoming month. Today being October 31, I'm setting my sights on November expiry.

I've been noticing some mostly sideways action in the oil & gas space in recent months. And with premiums somewhat elevated in options, delta neutral income strategies become extremely appealing.

Selling premium when options volatility is relatively high is a repeatable edge that plays out in my favor over time. So I like to put myself in position to take advantage of these situations as often as I can -- ideally when the underlying is caught in a range and my analysis indicates the range is likely to continue.

I found a stock where earnings have come and gone with little impact upon the overall trend, volatility collapsed (predictably), and now the only question left to ask is: when does the Santa Rally begin?

One of our bigger directional wins this summer/fall is showing signs of taking a breather, but traders with a memory are still keeping a bid under options prices. This is setting up the potential for a nice "income trade." When volatility is high (and therefore options premiums are juicy), and my bet is some sideways action in the near-term, these are the ideal situations to employ delta-neutral credit spreads.

The S&P 500 is back near highs. Call me crazy, but bullish setups in this environment with low volatility in the options get my antennae up for my favorite bullish strategy -- the simple long call. (Keep it simple, slugger!)

Sifting through all the trade ideas from the latest All Star Charts Quarterly Playbook, I happened upon a stock that is still several weeks away from earnings, is just a touch below all time highs, is trading at its lowest volatility of the year, and has a clearly defined risk management level. As you can imagine, this is pretty damn near the perfect set up for my favorite options play...

A funny thing about Gold is, people who have any kind of opinion on it are either EXTREMELY bullish, or EXTREMELY bearish. There tends not to be any middle ground. No surprise it is such a politicized instrument.

Well, I don't care about any of that. What I do care about is volatility priced into options in this space continues to be pretty juicy at the moment while prices of many Gold underlyings appear to be stuck in a sideways holding pattern. (You won't hear any talking head loudly yell on CNBC: "I THINK GOLD GOES SIDEWAYS!" LOL).

And the boys at ASC agree with me, having published a neutral opinion on it in their recently published ASC 4th Quarter Playbook. So let's get into the play that makes most sense from here.