JC had a great post this weekend about our favorite Magazine Cover Indicator violator -- The Economist. Go give it a read and then come on back here.

Are you caught up? Good.

You read what JC said to do. Let's do it.

Strazza and I did The Flow show earlier this week in which one trade that stood out and caught my interest was a juicy short squeeze candidate.

Checking back on it today, the stock still maintains a short position greater than 20%. That means more than one-fifth of all shares outstanding are held by people with a short position. And if this stock starts busting higher, the only way traders holding a short position can end the pain is to buy the stock.

This can potentially fuel a rapid rise in share prices (see: Gamestop $GME circa early 2020).

I'm certainly not calling for a repeat of past meme stocks short squeezes here, but in this case, we've got a stock that's chart is in the middle of completing a beautiful base and short holders are no doubt keeping their fingers near the trigger to exit this position quickly if we see some follow thru to the upside.

That creates opportunities for us.

Whoa baby. This might be a fun one. Or not. Either way, we'll likely find out pretty quickly.

Chinese stocks continue to offer up interesting opportunities. And today's trade is no exception. And to play it, we're going to do it in a fairly aggressive manner, but with a tight risk management stop.

Let's get right to it.

We're already long some domestic semiconductor stocks via options (the trend is working). However, perhaps we've set our sights too close to home.

International stocks have been on a tear recently, showing even greater strength than the U.S. So maybe we should be looking for the strongest stocks, in the strongest sectors, in the strongest countries?

With this in mind, today's trade takes us to Switzerland.

I'm an amateur chartist, at best. If you want charting experts, I'll refer you to my team here at All Star Charts.

That said, I've got my eye on what appears to be a bullish flag forming in a hot Chinese stock and it looks ready for liftoff. Coupled with cheap options pricing, we can neatly define our risks and position ourselves for a big win.

[9/7: updated stop to 56]

As promised during yesterday's The FLOW show, I'm following up on a possible trade idea we discussed.

However, after Strazza and I put our heads together with the rest of the Analyst team this morning, we're going to attack an opportunity in Schlumberger $SLB from a different angle -- one that can be rewarding regardless of which direction the stock takes.

It’s easy to follow a trading plan when the price action is moving our way. We feel like geniuses.

Look at me! I’m so smart! The stock market is doing exactly what I planned for it to do! Let’s go car shopping!

But how do I feel if the price action goes the other way?

Assuming I’ve put a trading plan together that accounts for both the possibility of being right AND the possibility of being wrong, why should I feel any different when the price goes the wrong way?

What’s the point of putting together a detailed trading plan if I later exit the position following the first price move in the opposite direction I hoped for?

Why go through all that effort?

A little pullback in stocks today has opened up the window for us to sell some options premium as a nice portfolio hedge for our predominantly long portfolio.

We don't need a long preamble here. The plan is simple: I'm going to enter a delta-neutral credit spread in an ETF that is currently atop my list of ETFs sorted by implied volatility.

Earlier this week, we took our original risk capital out of our Micron Technologies $MU position, and now we're enjoying a #FreeRide into the summer.

We've got a somewhat more conservative bullish bet going in Analog Devices $ADI via a call calendar spread.

As you can see, we've already got exposure to the semiconductors space. But there is a ton of bullish action here so as long as it keeps working, we're going to wade a little deeper in the semis pool for our next trade. 

Today’s note has nothing to do with trading, and absolutely everything to do with trading.

Let me explain.

The solutions to trading problems aren’t always found when we’re trading. In fact, I would argue most of the time they aren’t. At least not for me.

Have you ever been in the shower, on a walk with your dog, or driving your car when suddenly you were struck with a fantastic idea or an important “to-do”? Not just about trading, but about anything?

Happens to me all the time.

Even worse, it seems that whenever I’m struck with a great idea or a prompt for an errand I need to do, they come in waves. The brainstorming just flows ideas out of my head in a torrent that makes it impossible for me to remember everything. And it always seems to happen when I have no ability to write it down.

So I just try to remember it all until later when I can either perform the task, send that email, write that blog post, make that trade, or adjust that strategy.

But this act of remembering prevents me from moving forward when all I’m trying to do is balance the spinning plates of thoughts running in my head.

Remembering consumes far...