The Santa Rally Back On!

December 10, 2021

Dear Trader, 

When it looked like the bears were in control…fumble! 

The bulls came rushing back in and erased those losses. 

Even though we’re right back off all-time highs we have some big questions to answer.

For instance, we also haven’t heard much about supply chains for weeks, even though it continues to be an issue. 

Black Friday sales were lower than last year, which is surprising with all the money the Fed has printed. 

There are many more, but the answers to those questions don’t bode well for a positive outlook as we head into 2022. 

Despite the broad look at the economy, we’re focused on short-term gains and we’re in a traders market with this whipsaw action.

After a string of losers, we were able to put a nice win on the board. 

As I often say, the toughest part is to stick with the plan and focus on the next trade.   

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

But we saw a 47% decline in fear from last week's spike to 35. 

We continue to be a bull market, but it’s a bull volatile right now.

With that said — let’s review our open positions and the ones expiring today. 

Portfolio Update

Today, this position will expire.

BAC Dec. 10, 2021, $48/$50 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:

Buy-to-open FB Dec. 10, 2021, $332.50 call

On Tuesday:

Sell-to-close FB Dec. 10, 2021, $332.50 call

On Wednesday:

Buy-to-open the PFE Dec. 17, 2021, $50 put

On Thursday:

No action.

On Friday:

No action.

Right now, we’re holding:

  • TROX December 17, 2021, $25/$30 call spread
  • CCJ Dec. 17, 2021, $30/$36 call spread
  • MPC Dec. 17, 2021, $67/$70 call spread
  • PFE Dec. 17, 2021, $50 put

Trade 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.

 FB Dec. 10, 2021, $332.50 call

Outcome: Closed for 200% gain.

Notes: We executed exactly this perfectly. It would’ve been better if it didn’t shake us out with that pull back and rip higher the following day, but that’s trading. 

BAC Dec. 10, 2021, $48/$50 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

Joshua M. Belanger
Joshua Belanger is founder of CounterVest and the editor of Hot Money Trader. He has been providing ordinary investors blockbuster returns since 2008. In 2018, the average return of Hot Money Trader beat the markets by over 15%