Thx for that feedback Dan. The video ended up much longer than I had intended & may have seem redundant, as there seemed to be a common theme in the charts of nearly all sectors (breakdowns of clearly bearish technical patterns followed by a WTF? sharp rally to marginal new highs on questionable low volume with bearish divergences in place). However, as I often mention, for every official trade idea that I post, there are many more unofficial trade ideas & some of those sectors that were covered, such as the financials, still look poised to move lower in the coming weeks & possible months.

One of the key takeaways that I wanted to share in the video was that it appears like another broad based selloff has only recently begun in which I see very few, if any places to make money on the long side as nearly all sectors, even those that might normally rise during a stock market correction, look poised to fall. That includes the gold mining stocks, which I had covered, and even corporate bonds, which I did not have a chance to get to but appear poised for a correction as well (LQD is the corp bond ETF & looks poised for a correction IMO).

pang- I’m walking out the door for an appt so don’t have time for a full reply but I did give my thoughts on this $VIX in this reply yesterday: http://rightsideofthechart.com/members/getitriight/activity/10524/
You might have to use the search box (search “$VIX” or “VIX”) to find my most recent charts that show those levels. I’ll be back around 11am ET if you have any other questions on it.

It looks to me that from this point, both USO & XOP have about the same downside potential & the R/R ratio of either is simply a function of what your profit target & stop will be based on your entry price. A more important consideration, IMO, is the fact that they have both experienced some pretty sharp selling over the past two trading sessions & while that could certainly continue, with each tick lower the odds for a counter-trend bounce increases. The 3x leverage ETFs like DWTI & DRIP work great during a unidirectional selloff, marked by consecutive red closes. However, even if my price targets were to be hit, there is the possibility that oil & the energy stocks could make a choppy, slow grind lower which could result in decay if long the 3x ETFs.

SCO is the 2x short crude ETF which would suffer less decay in a choppy move to the targets while still providing you some leverage. SZO is the 1x (non-leverage) crude short ETN although it is thinly traded so you might have to use limit orders to buy & sell if the spreads are large to prevent a bad fill. Likewise, instead of DRIP you can use SOP (2x short oil & gas exploration ETF). Again, a thinly traded option but you can also use DUG (2x short oil & gas, which has plenty of liquidity although it tracks the DJ Oil & Gas index).

Yes, a breakout of the pattern to the downside, aka breakdown. While I often refer to a downside break of a chart pattern as a breakdown, they are also referred to as downside breakouts (vs. an upside breakout).