As news from the European Leaders Summit surfaced on Thursday (surprise, surprise they still have no real solution to their debt crisis), equity markets sold off in a classic “buy the rumor sell the news” fashion (i.e. markets rallied in anticipation of great news, followed by a selloff because there are still no answers). However, the real question is what comes next? My base case is that we’re due for a bounce at the open on Friday morning (i.e. the selloff created a nice “margin of safety” entry point), followed by more selling over the next week or two, and ultimately a Santa Claus rally during the last week of December to bring the S&P500 to around +5% for the year. Obviously, I have no crystal ball, but I am willing to put some of my money where my mouth is, and here's how I've positioned my trading portfolio to profit from my expectations... click here to continue reading.