Dear Trader, 

After a slow six weeks of trading…

...The action picked up this week with a little shake out. 

I wasn’t expecting a pullback until after expiration because on monthly options expiration week; indices inch higher into expiation. 

But as my friend Nick said who is a trader too “I can’t remember the last time things made sense”. 

I couldn’t agree more, but that is why it’s important to focus on the system and execution. 

As summer comes to an end, markets will pick back and up and it will be an exciting 4th quarter. 

Now, the CBOE Volatility Index (VIX), aka the “fear” index, is at 18 above our key 15 level.

The VIX did spike to 25 the last two previous sessions, but then dropped back today. 

We continue to be a bullish regime, but 

So the bias is higher for now. 

Now let’s talk shop.

Portfolio Update

Today, this position will expire.

• EDU Aug, 2021, $10/$12.50 call spread

Unfortunately, we don’t have more time for this to play out.

There’s nothing that you need to do and will be removed from your account over the weekend.

Taking losses isn’t fun, but without the bitter, the sweet isn’t as sweet.

But remember…

The sweet part is making money and losses are part of the process.

Here’s a recap of what we did this week.

On Monday:

Buy-to-open the BTU September 17, 2021, $15/$17 call spread

On Tuesday:

No action.

On Wednesday:

No action.

On Thursday:

Buy-to-open the JNPR September 17, 2021, $29/$31 call spread

On Friday:

No action

Right now, we’re holding:

• FCX September 17, 2021, $38/$41 call spread
• SNAP September 17, 2021, $80/$90 call spread
• YELL October 15, 2021, $7.50/$10 call spread
• HAIN September 17, 2021, $40/$44 call spread
• JNPR September 17, 2021, $29/$31 call spread
• BTU September 17, 2021, $15/$17 call spread

Joshua’s Journal

This is my journal which is a debrief of every trade closed or expired to analyze what happened, why it happened and how it can be done better — like what the military uses after missions.

EDU Aug, 2021, $10/$12.50 call spread

Outcome: Expired worthless.

Notes: I read the activity wrong and got us on the wrong side of the trade. The activity our system flagged was call options buying as a hedge on a short position. I underestimated the risk of the Chinese government crackdown on everything from ride-hailing to education companies. 

But this is why I love options because owning the stock would’ve been a disaster. I took a shot and I was wrong. We move onto the next trade. 

Now it’s time to get my 7 mile run in before I head to the pool with a fresh jalapeno margarita - TGIF! 

I'll have a new trade on Monday.

To your wealth, freedom, and options!

Joshua M. Belanger