Well, you can see why we call it our "Must Hold Line."
2,850 on the S&P 500 has been the center of all the action for the past month and that GOOD since, 1/3 into earnings season, it indicates we made the right call with our predicted ranges for the year. Of course it's also BAD – because those ranges are now a far cry from the market highs we had before… They are not coming back in the near future, so stop wishing for them (see "Portfolio Repair Workshop Part 4 – Adjusting Our Goals to Reflect Reality").
This is a huge advantage options traders have over stock traders: If you own stock in IBM, for example, at $140 and now it's at $120 - you can cross your fingers and pray it gets back to $140 (it will) or you can double down at $120 and lower your basis to $130 and hope it gets back to that and that's about all your options (other than taking the loss).
With stock options, however, I can cash out my 100 shares of IBM at $120 and IMMEDIATELY get my $20 loss back by selling the 2022 $115 put for $20. The put contract obligates me to buy IBM for $115 between now and Jan 2022 and the buyer of that contract is willing to pay me $20 to cap loss on IBM at $95 – maybe he bought it for less, maybe he also sold calls – don't know, don't care because I got my $20!
With $20 back in our pocket and $120 from the sale of the stock, we are now even (not that we would have been so foolish as to buy stock in the first place!) and our worst-case scenario is owning IBM again at $115. Still with $140 back in our pockets we can even get a bit more bullish and we can buy the IBM 2022 $110 calls for $21 and sell the 2022 $130 calls for $12 and that's net $9 on the $20 spread.