Patrick Ceresna

WTI Crude options show a "distinct right tail skew" where upside calls are expensive relative to downside puts. The market is rangebound in the $60s but carries significant geopolitical headline risk. Instead of buying flat futures (delta 1) which are subject to whipsaws, one can use the skew to finance a position. By buying lower IV in-the-money calls and selling higher IV out-of-the-money calls, you create a position that profits even if oil stays flat, but captures upside if a geopolitical event occurs. Patrick suggests a Bull Call Spread (specifically referencing April 2026 contracts). For the general investor, this translates to a tactical long position with defined risk. A de-escalation of geopolitical tension could send WTI down to $55.

"A substantial reversal of the dollar trend... The dollar strengthening here seems to have room to come to the top of the trade range near the 100 handle." In times of kinetic war, institutional mandates force capital into US Treasuries/Dollar for safety, overriding long-term bearish fundamentals. The Euro breakdown further supports the DXY (UUP) rally. LONG. Momentum and safety flows are driving a short squeeze on the Dollar. Fed intervention or a rapid shift in global sentiment regarding US foreign policy.

Uranium miners have corrected sharply, clearing out overbought technical conditions, but the long-term fundamental demand from the AI/Energy thesis remains intact. The recent sell-off was a "shakeout of weak hands" (likely margin calls from precious metals traders). The structural deficit in uranium supply has not changed, making this dip an entry point for the next leg of the bull market. LONG. Re-enter the nuclear fuel cycle trade after the technical washout. A liquidity event in broader markets dragging down all commodities, or a nuclear accident.

Gold has corrected roughly 20% peak-to-trough but the long-term structural bull market driven by de-dollarization and central bank hoarding remains intact. In a sanctions-heavy world, gold is a reserve asset, not just a trade. However, volatility is high. To manage this, investors should maintain core long exposure but hedge the "fat right tail" skew. Implement a "Collar" strategy. With GLD at $476, Buy the May 2026 430 Put and Sell the May 2026 575 Call. This finances downside protection by capping extreme upside, creating a defined risk envelope. A de-escalation of geopolitical tensions or a sudden strengthening of the US Dollar could suppress gold prices below the put strike, though the hedge protects against crash risk.

Refined product markets remain tight with diesel and gasoline crack spreads near all-time highs, supporting refiners; Valero (VLO) is a leader breaking to a 52-week high, and a bull call spread provides defined-risk exposure to the refining theme.

Beneath the surface, there's still structural stresses building, particularly in private credit where redemption pressures continue to surface and in the systematic space where several flow triggers are now being hit. Weakness in mega-cap leadership and underlying structural stresses mean the market is highly vulnerable to a sudden 10+% drop. Buying defined-risk downside convexity, such as a 95/85 put spread, costs a very small percentage of portfolio value (roughly 80 basis points) but offers an asymmetric 11:1 payoff if these fragilities trigger a broad market liquidation. SHORT the broader equity index using put spreads to hedge against left-tail risk while managing premium costs. Geopolitical tensions de-escalate and the market grinds higher, causing the hedge premium to expire worthless.

The NASDAQ 100 has failed to reclaim its 50-day moving average, driven by weakness in software stocks. However, Semiconductors are making fresh 52-week highs. Capital is rotating within the tech sector. While the broader index and software struggle with overhead resistance, the momentum and relative strength are concentrated purely in hardware/semiconductors. Long Semiconductors as the clear leader in a bifurcated tech market. If the "Mag 7" generally roll over, they could drag the high-flying semi sector down with them.

Cheniere Energy (LNG) breaks out above its 50-day moving average and descending trendline, offering a clean expression of the US LNG energy security and AI power demand thesis. A protective put at $240 hedges early breakout risk.

AI buildout creates a power bottleneck where natural gas is the crucial bridge fuel for electricity demand. Recommends being long natural gas via UNL (cleaner ETF with laddered exposure) or using options on Dec 2026 natural gas futures for convex upside with defined risk.

Michael Every's thesis that policy is shifting from supporting financial assets to rebuilding the physical economy (infrastructure, supply chains, strategic manufacturing) can be expressed via the PAVE ETF. The trade is a long position in PAVE shares paired with a near-term protective put to manage short-term market overextension risk.

The Strait of Hormuz crisis exposes energy infrastructure fragility. Even if the shooting stops, hardening pipelines, restarting wells, and rebuilding confidence will take months to years. This creates a multi-year investment cycle in oil field services. The XES ETF has already rallied but using long-dated calls captures upside while limiting downside risk from peace headlines.

Copper has broken out to all-time highs and the bull impulse should continue, with pullbacks contained to 25-50 cents. The next target is $7.00, and the copper market remains decisively bullish.

European financials have materially outperformed US financials since early 2025 despite a more fragile macro backdrop. As the energy crisis transmits into margin pressure, credit deterioration, and second-order effects, European financials should begin to underperform. The trade pairs a long in US financials (XLF) against a short in European financials (EUFN) to capture the anticipated relative mean reversion.

European financials have materially outperformed US financials since early 2025 despite a more fragile macro backdrop. As the energy crisis transmits into margin pressure, credit deterioration, and second-order effects, European financials should begin to underperform. The trade pairs a long in US financials (XLF) against a short in European financials (EUFN) to capture the anticipated relative mean reversion.

The speaker proposed buying May 2026 $13 put options on the BIZD ETF, a public market proxy for Business Development Companies (BDCs) and private credit. Matt Barrie's analysis indicates private credit is stressed because its portfolios contain debt from SaaS companies whose business models are being eroded by AI, and funding rounds are becoming too large for equity, forcing over-reliance on debt. SHORT (via puts) to gain convex downside exposure to a potential repricing of credit risk in the private credit space, while avoiding the negative carry of a physical short. The private credit market stabilizes or rallies, or the stress does not materialize in the public BDC complex within the option's timeframe.