Bulls look to be recouping their strength for a run at the New Year’s high. We tried to buy puts at the exact time the high was achieved, but they stayed just beyond our grasp. Now, with DIA within easy distance of the original target, it is tempting to think it will soon give way, as have all other highs achieved since 2009.  Equally tempting, however, is the prospect of taking long odds on a plunge that would undoubtedly catch most traders and investors by surprise. Accordingly, I’ll recommend buying four Feb 7 158 puts for 0.36, and another eight for 0.32, day order. You should stop yourself out if the options trade down to 0.18.  Keep in mind that out-of-the-money puts have been one of the worst gambles you could have taken in the last five years, and that this play is just that — a gamble based on a gut hunch. If the order fills and survives for at least a few hours, check back here or in the chat room for further advice, since we’ll want to spread off our risk and make the puts we own ‘free’ at the first opportunity. _______ UPDATE (9:51 a.m. EST):  The puts opened for 0.36 and were briefly offered at that price, so I am assuming a fill on four contracts. For your psychological well-being, and to help you cope with the next unfathomably stupid, monster rally, I’d suggest setting the stop-loss advised above and kissing your money good-bye.  Be comforted as well by the fact that we are only risking $72 theoretical on this wild speculation. _______ UPDATE (11:10 a.m.): And now we are filled on the puts at the lower price as well. I intend that the 0.18 stop-loss be able to weather a further rally to the New Year’s high. Our average price is about 34 cents. _______ UPDATE (January 23, 12:12 p.m.): The broad averages are down big today and seemingly headed lower. Offer Feb 7 155 puts short for 0.34, good till canceled, in a 1:1 ratio against Feb 7 158 puts bought earlier. If the order fills, you’ll have a dozen $3 bear vertical spreads with zero risk and a maximum potential profit of $3600. _______ UPDATE (4:45 p.m.): DIA Feb 7 155 puts were an easy short for 0.34, since they traded as high as 0.36 when the Dow was getting crushed, down nearly 240 points at the lows.  You should now hold a dozen Feb 7 155-158 puts spreads for a cost of zero, meaning they cannot lose.  Better yet, if the Indoos continue to fall over the next two weeks, this relatively small position could produce a profit of as much as $3600. For now, you can simply forget about it, since we’ve accomplished our goal buying a bunch of puts for what they are worth — i.e. nothing.