Today's trade is going to leverage the rising volatilities introduced into the stock market this week thanks to testimony from the Federal Reserve Chairman (I've been told).

When markets get dicey and volatility rises, I like to look at my universe of Sector ETFs and choose one that is both displaying higher relative options prices than its peers and looks set up for rangebound trading action over the next 3-5 weeks.

An ETF near the top of my list is the Materials sector ETF $XLB. We're going to bet on the recent sloppy trading action to continue sideways for a bit, and we're going to sell a delta-neutral spread to collect premium and position ourselves to earn the decay.

The next new position in our Paid-to-Play portfolio is:

We’ve been looking out for this filing since last week!

Right on time, Uncle Warren strikes again with the Berkshire put in Occidental Petroleum $OXY.

From the Desk of Kimmy Sokoloff

The market hit the breaks yesterday after Fed Chair Jerome Powell’s speech.

Powell is to speak again today, which could make for sloppy trading.

This is the video recording of the March 8, 2023, Inside Scoop Weekly Strategy Session.

From the desk of Steve Strazza @Sstrazza

We held our March Monthly Strategy Session on Monday night. Premium Members can access and rewatch it here.

Non-members can get a quick recap of the call simply by reading this post each month.

By focusing on long-term, monthly charts, the idea is to take a step back and put things into the context of their structural trends. This is easily one of our most valuable exercises as it forces us to put aside the day-to-day noise and simply examine markets from a “big-picture” point of view.

With that as our backdrop, let’s dive right in and discuss three of the most important charts and/or themes from this month’s call.

It's the weekly currency edition of What the FICC?

Dollar and rates were big themes last year – rising in tandem – and continue to be as we head into March.

It shouldn't come as a surprise as the next chart reveals the crux of the story…

Check it out!

From the Desk of Ian Culley @IanCulley

What year is it? 

Is it 2023 or 2022? Because it’s starting to feel like last year all over again…

No, Will Smith hasn’t slapped anyone (that I’m aware of). And I’m confident Bennifer 2.0 is going strong (solely based on Superbowl commercials).

But that’s not my concern. Here’s what does have my attention: the dollar and rates. 

These were big themes last year – rising in tandem – and continue to be as we head into March.

It shouldn't come as a surprise as the next chart reveals the crux of the story…

Check out the overlay chart of the US dollar index $DXY and the US 10-year yield $TNX with a rolling 126-day correlation in the lower pane:

Notice the consistent positive correlation between the US benchmark rate and the dollar since fall 2021. It all began as Federal Reserve officials swept...

From the Desk of Kimmy Sokoloff

That was a very volatile day, as we had Fed Chair Jerome Powell speaking.

And he's speaking tomorrow too.

From the desk of Willie Delwiche.

Dynamic Portfolio Update: Our asset allocation models are tilting away from commodities, so we sold GLD in our cyclical portfolio (and replaced it with mid-cap equity exposure). With tactical risks rising, we raised some cash in our tactical opportunity portfolio.

From the desk of Willie Delwiche.

As good as the market looked in January, it looked that bad in February. The month began with the technical conditions for the re-birth of a bull market being met, but by the end of the month there was still little evidence of bull market behavior. If the Q4 turn is going to prove resilient, it’s time for the bulls to step up and show that the path of least resistance is indeed higher. That means firmly embracing a rally that has faltered under the ongoing weight of macro concerns and is on the cusp of breaking down.

Our Weight of the Evidence Dashboard fills in the details and includes a few charts that have our attention heading into March. 

The next new position in our Paid-to-Play portfolio is:

Last night was our Live Conference Call that I host at the beginning of each Month.

It gives us an opportunity to take a step back and identify the direction of primary trends.

This is helpful, because without understanding the environment we're in, how could we possibly pick and choose which tools and strategies to incorporate?

This step often gets forgotten about by investors.

Many would rather just shove their strategy down the market's throat whether it makes sense for that environment or not.

I find that foolish.

One chart that I thought told an important story ...

The largest insider buy on today's list comes from DISH Network Corporation $DISH co-founder and executive vice-president, James DeFranco. 

DeFranco revealed a purchase of $15.7 million worth of DISH shares in his latest Form 4.

From the Desk of Kimmy Sokoloff

So, the market had a little bit of a rug-pull yesterday.

I'd like $SPY to hold the 404 level, otherwise we run the risk down to 402.

This is the video recording of our March 6th Monthly Charts Live Strategy Session

From the Desk of Steve Strazza @Sstrazza.

Welcome back to Under the Hood, where we'll cover all the action for the week ended March 3, 2023. This report is published bi-weekly and rotated with The Minor Leaguers.

What we do here is analyze the most popular stocks during the week and find opportunities to either join in and ride these momentum names higher, or fade the crowd and bet against them.

We use a variety of sources to generate the list of most popular names.

There are so many new data sources available that all we need to do is organize and curate them in a way that shows us exactly what we want: a list of stocks that are seeing an unusual increase in investor interest.

Whether we’re measuring increasing interest based on large institutional purchases, unusual options activity, or simply our proprietary lists of trending tickers, there’s a lot of overlap.

The bottom line is there are a...

From the desk of Steve Strazza @Sstrazza

Our Top 10 Charts Report was just published.

In this weekly note, we highlight 10 of the most important charts or themes we’re currently seeing in asset classes around the world.

Don’t Ignore Coal

Our equal-weighted custom index of the largest coal stocks reached new highs last week. If this breakout sticks, coal is a group we want to keep leaning on for long exposure.

From the Desk of Steve Strazza @sstrazza and Alfonso Depablos @Alfcharts

This is one of our favorite bottom-up scans: Follow the Flow.

In this note, we simply create a universe of stocks that experienced the most unusual options activity — either bullish or bearish, but not both.

We utilize options experts, both internally and through our partnership with The TradeXchange. Then, we dig through the level 2 details and do all the work upfront for our clients.

Our goal is to isolate only those options market splashes that represent levered and high-conviction, directional bets.

We also weed out hedging activity and ensure there are no offsetting trades that either neutralize or cap the risk on these unusual options trades.

What remains is a list of stocks that large financial institutions are putting big money behind.

And they’re doing so for one reason only: because they think...

From the desk of Steve Strazza @Sstrazza

Check out this week's Momentum Report, our weekly summation of all the major indexes at a Macro, International, Sector, and Industry Group level.

By analyzing the short-term data in these reports, we get a more tactical view of the current state of markets. This information then helps us put near-term developments into the big picture context and provides insights regarding the structural trends at play.

Let's jump right into it with some of the major takeaways from this week's report:

* ASC Plus Members can access the Momentum Report by clicking the link at the bottom of this post.

Macro Universe:

• This week, our macro universe was positive, with 79% of our list closing higher with a median return of 1.55%.
• Oil $CL was the winner, closing with a 4.40% gain.
• The biggest loser was The Volatility Index $VIX, with a weekly loss of -14.67%.
• There was a 9% gain in the percentage of assets on our list within 5% of their 52-week highs – currently at 15%.
• 4% of our macro list made fresh 4-week highs.
• ...