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I don't like how many oversold conditions have been hit in the major indexes and most sectors. I've tried my best to point out the stocks showing both relative strength and momentum. But there are an awful lot of charts I see where oversold conditions in momentum is a problem. So the question becomes, is a retest of the lows necessary for stocks to continue higher?

The market is never going to give us what we want. We have to take what the market gives us. Play the hand we're given, not the hand we wish we had. What worked in one market environment is not going to work in another. That's why all those filters fail so frequently, because you're trying to take something from the market instead of taking what it is giving us.

This week, a spike in volatility caused forced selling in stock index vehicles that trickled down to ETFs and individual stocks. We did not see any stress, however, in credit markets, currencies or any of the commodities like Crude Oil or Gold. This is further evidence that we want to continue be buyers of weakness, like we have been throughout all of last year and most of 2016. There will be periods where we want to be sellers of strength, but I don't believe that is the correct approach today.

If you've been following along, I try and go out of my way to discuss risk management techniques, tools and signals when the market gives them to us. Whenever I lay out a thesis, I like to talk about what the market should look like in the case that we are correct, while at the same time outlining what the environment would look like if we are wrong. The idea is to picture both scenarios and as the data comes in, try to identify which outcome we're in as quickly as possible.

Based on what we saw in some of the volatility related products this week, it's clear someone got squeezed, or a bunch of someones. There was big money leaning in the other direction clearly. We've seen this sort of market behavior regularly - last April/May, then again in August. This was more extreme and most likely not the last time it happens. This is becoming normal. These leveraged products are a real risk when they all get squeezed simultaneously, there are forced liquidations. We saw elevated levels of volatility throughout the 90s and stocks kept rallying for years. So we can have volatility and rising...

Biotechnology has not been something you've been hearing me pound the table about for a long time. I was a huge Biotech bull in 2015, but this has not been something we've wanted to be involved with much since. The biggest reason is for the dramatic under-performance. The winning areas have been in Technology, Industrials and Financials, not Biotechnology. If we've wanted to be in healthcare at all it's been in the Medical Device and Equipment stocks, not Pharma or Biotech.

It's 2018 now and things are changing; sectors are rotating. We're seeing strength in Energy, Materials and really just Natural Resources in general. Canada and Australia breaking out finally points to strength in that area as well.

Today we're going to talk specifically about Biotechnology and if/where we want to be involved. 

One of the things that often gets underrated is the power of simplicity. What's wrong with only looking at price and focusing in only on what matters most? I get that you love your moving averages and candlesticks and all sorts of momentum indicators. But the most important indicator is still price. So that's what we're going to look at today using OHLC Bar Charts.

Every month I host a conference call for All Star Charts Premium Members where we discuss ongoing themes throughout the global marketplace as well as changes in trends where new positions would be most appropriate. This includes U.S. Stocks & Sectors, International Stock Indexes, Commodities, Currencies and Interest Rate Markets.

We've been extremely bullish towards US and Global Stocks as they remain in strong uptrends on any sort of intermediate-term time horizon. I still think this is an environment where we need to be buying weakness in stocks, not selling strength. The weight of the evidence is still pointing to an increased amount of risk appetite, not risk aversion. We will go over a multi-timeframe approach on this conference call where we will start with the longer-term and then work our way down to more short-term to intermediate-term investing ideas. This will also include other assets like the US Dollar, Euro, Gold, Silver, Crude Oil and Interest Rates.

I'll do my best to lay out my weight of the evidence conclusions and walk you step by step with how I got...

Natural Gas stocks? When was the last time you heard me talk about those?? There is a time and a place for everything. We've discussed the relative strength in Energy stocks as a group lately and have pointed out some interesting opportunities, particularly in the Oil Refinery space, Valero especially. That has worked very well in our favor the past few months.

But moving forward I think there are some extremely favorable risk vs reward scenarios within the Natural Gas stocks as well as all of them as a group.

We want to go into 2018 forgetting everything we thought we once knew. The process of approaching every market with an open mind is something that I think is very important. Our goals of profitability need to outweigh any emotions driven by ego.

I've been very critical of Gold, Silver and Precious Metals stocks since the Summer of 2016 when they hit the upside objectives we gave them earlier that year. Since then, it's been a sideways mess, with fast moves lower and abrupt mean reversions higher. These are characteristics of messy markets, not trending ones like U.S. Stocks were for example since, coincidentally (I doubt it) that Summer of 2016.

Today we're going to go over the best risk vs reward propositions in the Gold market as we enter 2018:

Here is a list of trade ideas organized by date, ticker symbol and directional bias. Please make sure you have clicked on the link and read the details surrounding the trade before acting upon any of them. Also, make sure you have checked with your financial advisor and tax accountants to make sure you are suitable to be executing what is discussed on this website. The risk management procedures and targets are detailed for each idea. Please read and review the terms and conditions page before making any trades of your own.

We do not make end of 2018 forecasts. I think it's irresponsible to think that we have any idea of what will happen a year from now. We want to reevaluate our thesis as time goes on and new data comes in. This reevaluation process occurs consistently throughout the entire year. How else can we manage risk responsibly? Are we supposed to place our bets after New Years and just hope for the best? Come on.

Take a deep breath. Forget everything we did this year and only think about where we are today. The idea is to keep an open mind and keep every option available. If we've loved something in 2017, that doesn't mean we can't hate it in 2018. Just because we've been shorting something this year, doesn't mean we can't be buyers in the next coming quarters. We're not here to be right, we're here to make money. We can't forget that and let ego take priority over profitability. It's important to be aware of our cognitive behavior patterns and this is one of them.

Lastly, we want to ignore what the year-to-date returns were for different asset classes. I think the arbitrary Jan 1 to Dec 31st performance doesn't help us identify the direction of primary trends. So to...