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Starbucks Hit the Spot

This article originally appeared on Jan. 24, 2014, on To read more content like this + see inside Jim Cramer's multimillion dollar portfolio for FREE... Click Here NOW.

NEW YORK ( Real Money) -- Starbucks (SBUX - Get Report) ended up working out today. Given the overall market conditions, I feel a bit fortunate to make any money in the trade. It wound up costing me a bit more than I anticipated, as the total trade was $12.10 for every three of the diagonal spread combinations as well as two of the January skip-strike call combos. Still, I was able to sell them for $13.75 and pull in some money on an otherwise ugly day.

I did take a few long-side stabs and made some pin play attempts today. It was negative across the board. We are in a very tough short-term environment. Unless you enjoy the gap risk overnight, right now is not the time to be taking a lot of swing trades in either direction.

I did buy some Valero Energy Partners (VLP) today for my long-term buy-and-hold account. Valero Energy (VLO) is following the exact same path as Phillips 66 (PSX). This leads me to conclude Valero has some more upside based on the how Phillips's spinoff, Phillips 66 Partners (PSXP) has performed. I also think the distributions will be a bit higher on Valero Energy, but I would have no problem holding both.

As we head into the close, I think we want to see a bounce and not a close at the lows. A close at the lows will lead me to believe that folks not following the action today will be spooked over the weekend and spur more initial downside action into Monday. If we don't see some type of positive close today, then we absolutely need something positive out of China over the weekend. If not, then then SPDR S&P 500 (SPY) may get to that $174-$176 range more quickly than I anticipated.

At the time of publication, Collins was long VLO.

Timothy Collins has worked as a financial adviser since 1999, focusing on portfolio customization, with a concentration on correlation arbitrage and risk-managed growth. He started Collins Capital Advisors in 2007, which evolved into TangleTrade Management, LLC. Currently, he operates Retro Wall Street, a site focused on education, trader mentoring and humor. You'll find him spending his days in the Retro Wall Street chat room.

Prior to joining his first firm, American Express Financial Advisors, in 1999, Collins worked as a staff accountant for United Information Systems in Bethesda, Md. He has also worked as a financial analyst for Securities Pricing and Research in Annapolis, Md. Collins is a graduate of McDaniel College (formerly Western Maryland College), with degrees in business administration, economics and sociology and is a winner of the Bates Prize.

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