Bought +15 BC 100 SEP 09 7.5 PUT @.39, Mark 9.12

It doesn't look like that the market will correct any time soon. The pre and post FOMC action today merely produced a few points of move on the S&P500. However, with the S&P500 making a marginally new high, the high risk sectors (i.e. financial XLF and real estate IYR) are still off their highs by much. Furthermore, the junk bonds (JNK) is failing to lift too. This is a good sign that the junk of the market aren't being bidded for. This is definitely a negative divergence. However, things aren't always that easy. From that lack of participation either way, we'll likely move within a range for a while. So my COF short is in threat of expiring. The move for me now is to unload both COF and my hedge in PG long before expiration next week. I bought Brunswick Corp (BC) for September's expiration because some meaningful move is likely, particularly considering the scenario BC is in now. Looking at Figure 2, BC has tested a solid long term resistance about \$10. It has tanked more than 4% today while the market is up about 1% and marked a new intraday high. And in case you haven't noticed, BC has been going through wild cycles of ups and downs. Those patterns are looking darn nice if this is indeed the top for BC. We can expect BC to be breaking below \$6 if history plays itself out once again. Furthermore, the intraday push to resistance at 9.25 has failed miserably in the late day (Figure 3). That was when I decided to enter this position. Entry: \$9.12 Stop: \$9.70 Target: \$6.00 Reward / Risk = 3.12 / 0.58 = 5.4 > 5 Note: Because these are farther out options, my risk is definitely higher than this simple calculation depicts because of the time decay. I will need to figure out a simple way of better assessing my risk other than using Black-Scholes manually. P.S.: Forget to mention that I picked up this tip for BC from Cara Community. [caption id="attachment_1690" align="aligncenter" width="500" caption="Brunswick Corp"][Brunswick Corp][][/caption] [caption id="attachment_1691" align="aligncenter" width="500" caption="Brunswick Corp"][Brunswick
Corp][][/caption] [caption id="attachment_1692" align="aligncenter" width="500" caption="Brunswick Corp"][Brunswick Corp][][/caption]

[Brunswick Corp]: http://traderpau.files.wordpress.com/2009/08/2009-08-12-bc.png [Brunswick Corp]: http://traderpau.files.wordpress.com/2009/08/2009-08-12-bc_prop.png [Brunswick Corp]: http://traderpau.files.wordpress.com/2009/08/2009-08-12-bc_short.png