Dear Trader,
I hope you had a great Thanksgiving!
It was an ugly day in the market with the S&P 500 plunging 2.23% on a shortened trading session.
It's hard to gauge today's sell-off because so many are out of the office.
So it will be interesting to see how we open going into Monday.
The CBOE Volatility Index (VIX), aka the “fear” index, spiked higher by 54% closing at 28.62.
The last time we saw a 1-day spike of that size was Jan. 27, 2021.
But the market rebounded three days later.
Back on the trading floor, we would call days like today "black tape" days.
There's a trick to put a piece of electrical tape over your PnL — profit and loss statement.
Because if you positioned sized correctly we knew it wasn't a good day, but we knew tomorrow is a new day for opportunity.
That’s why it is important to keep a trader’s mindset: Block the noise and keep calm.
With that said — let’s review our open positions and the ones expiring today.
Today, this position will expire.
NVDA Nov. 26, 2021, $330/$350 call spread
LVS Nov. 26, 2021, $41/$115 call spread
Unfortunately, we don’t have more time for this to play out.
There’s nothing that you need to do, and they 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:
No action.
On Tuesday:
No action.
On Wednesday:
Buy-to-open the BAC Dec. 10, 2021, $48/$50 call spread
Buy-to-open the MPC Dec. 17, 2021, $67/$70 call spread
On Thursday:
No action.
On Friday:
No action.
Right now, we’re holding:
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.
NVDA Nov. 26, 2021, $330/$350 call spread
Outcome: Expired worthless.
Notes: Trading is tough because every stock and day is different. Everything was looking great and then within minutes it turned on a dime and quickly erased the gains. It’s frustrating, but we can’t win them all.
LVS Nov. 26, 2021, $41/$115 call spread
Outcome: Expired worthless.
Notes: We took our shot and this didn’t work out as planned.
Now it’s time to enjoy a fresh spicy margarita - TGIF!
Have a great weekend and talk with you on Monday.
To your wealth, freedom, and options!
Joshua M. Belanger