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I was recently asked a thoughtful question about whether a stock that is strongly tied to a commodity or sector can still be traded safely when using a volatility-based system.

The question stuck with me because it gets to the heart of why our approach works in the first place.

The concern was simple: If a stock tends to move with something larger, like a metal or an index, will that correlation override our signals? If the larger market drops, is the indicator irrelevant?

The short answer is no. The longer answer is what makes this strategy powerful.

It is true that gold miners move with gold. It is true that bank stocks move with interest rates and that technology stocks move with earnings expectations. Every stock has an anchor that influences it. That is normal. It is also unavoidable. Correlation is part of the market landscape.

We see this most clearly during sudden market events. When a shock hits, correlations rise fast.

During the Flash Crash of 2010, a large sale of S&P e-mini futures caused liquidity to break down and stocks across every sector fell together. That kind of systemic pressure cannot be diversified away. No strategy can escape it.

But correlation does not erase short-term mispricing. It does not cancel fear. It does not eliminate emotional spikes that push a stock beyond its reasonable boundaries.

And that is exactly where a volatility-based system shines.

Our disciplined indicator does not try to forecast commodities or guess the next big move in the market. It measures the behavior of the stock itself. It shows us when fear has become excessive relative to the stock’s own history.

Even in a correlated environment, those fear spikes appear again and again, and they often create the safest income trading opportunities.

One recent example involved a well-known gold mining stock that we traded using a simple put-selling strategy. The stock is tied closely to the price of gold, and gold had been volatile at the time of the trade.

Yet, the ITV indicator signaled that fear inside the stock had reached an extreme. We entered the trade, and by the time the option expired, the stock closed comfortably above our strike. The correlation was still present, but it did not override the signal.

This is why process matters.

We cannot control gold prices, interest rates, headlines, or sudden shocks to the market. No one can. But we can rely on a system designed to identify moments when fear becomes stretched, even when everything around it feels uncertain.

Many traders spend their time searching for predictions. We focus on something more reliable. We trust a rules-based signal that helps us find safe entries again and again, regardless of the broader background.

Correlation sets the stage. Our process finds the opportunity within it.

That is why this system works. And it is why it continues to work, even in a market where everything moves together more often than it seems.

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