[citation][nom]bogcotton[/nom]The term 'hot item' is often used to describe stolen/black market goods which are known, i.e. a rich man has his unique watch stolen, that's now a 'hot watch'; if you try to pawn it you could get in trouble.[/citation]
Well done, sir. You are correct.
Hot, besides referring to a state of temperature, can also characterize something recently stolen or smuggled, such as "hot merchandise" or "a hot car."