Chart of SPY (SPDR S&P 500 ETF, generally corresponds to the price and yield performance of the S&P 500 Index):
Chart of the VIX (CBOE SPX Volatility Index):
If you have been following the recommendations of optionsmojo.com, you have already experienced decent gain in the market. Although S&P500 still looks cheap (valuation) at this level, given the run up we have had, combined with the unrest in Northern Africa and Middle East, it is prudent to hedge our portfolio (or even take a short-term bearish bet).
You may consider one of the following two trades (or both):
1) Buy the March Quarterly 132/129 Put Spread on SPY for 0.95 for a potential Max gain of 2.05 (minus commissions) if SPY trades at or below 129-strike by March 31, 2011.
2) Buy the March 20/24 VIX Call Spread for 0.85 for a potential Max gain of 3.15 if VIX trades above 24 by March expiration.