It’s our first monthly options expiration Friday of 2020.

This hot-start is similar to 2019, but The difference is that the rally last year was after a 20% drop.

However, the similarity is that cheap money continues flowing on this record melt-up.

We often talk about fear being greater than euphoria but euphoria in the market place is at a concerning level.

The fear gauge for the S&P 500, known as the CBOE Market Volatility Index (VIX), at 12.

This is below our key level of 15 we watch, but volatility has been complacent.

Everyone is having a great time and feeling wealthy at these record levels, but eventually, the music has to stop.

While it’s good to try to understand the market and where it may be going, the only thing that matters is focusing on making money, not our opinion.

That is the power of options and Hot Money.

Stick to our system - come out on top!

Portfolio Update

On Monday, we bought to open Vistra Energy Corp. (NYSE: VST) April 17, 2020, $25 call up to $0.40 per contract or better, for the day.

Shares of the underlying went in our direction, but we saw volatility decrease on that rise which offset any profits. We have time for this position to work out and think we will be taking profits on this next week.

Earlier, we sold to close The Goodyear Tire & Rubber Company (NASDAQ: GT) Jan. 17, 2020, $15 call up to $0.10 per contract.

Right now we’re holding:

• Vistra Energy Corp. (NYSE: VST) April 17, 2020, $25 call

After-Action Report

The Goodyear Tire & Rubber Company (NASDAQ: GT) Jan. 17, 2020, $15 call

Date: Jan. 6, 2020

Reason: Our system flagged short-term under-market sentiment shift that could send shares soaring higher by today’s expiration.

Outcome: Exit at a 75% loss.

Notes: We saw share prices of the underlying push higher the following days, but then trade sideways. We executed and followed the signals as we should’ve, but it didn’t work in our favor.

With this loser out of the way, we know the next one will big a big winner.
As always, keep sending your questions and feedback to [email protected]

My team and I will have a new trade for you on Tuesday.