Sold -2 RTH 100 AUG 09 85 PUT @3.40 Mark 82.81

The market gapped higher today. RTH broke the 82 resistance clean at the open. It touched 83.75 at the high point but closed with a doji on low volume for the day. I was very tempted to hold my short overnight because of the heavy last hour selling. This certainly looks like the day to call it a top. However, I've been feeling like this for weeks, if not months, now and the market keeps going higher.

So I've managed to be disciplined and dumped my short RTH position seconds before the close. Seeing that although the last hour is encouraging for the bears, we still didn't close the gap.

Also, I'll be away tomorrow, so the risk is just too much as my stop has come and gone already. Even though this trade didn't turn out as planned. I'm glad that I've stuck to my strategy and didn't push my luck as I've done so many times before, only to regret my decisions.

It's better to be late to risk paper profit than be early and lose real money.

For this trade, my loss is \$120 + \$15 = \$135. Oh well, it could have been worse. The choice to hold out until the end of day to sell the losing position was a good one. I noticed in the morning that sentiment wasn't that strong as we inched upward. Particular on a big gap day, we need some serious momentum to push the market deeper. That didn't happen as I watched this morning so I decided to wait until the last hour.

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[caption id="attachment_1648" align="aligncenter" width="500" caption="Retail HOLDRS ETF"][Retail HOLDRS ETF][][/caption]

[Retail HOLDRS ETF]: http://traderpau.files.wordpress.com/2009/07/2009-07-30-rth.png [Retail HOLDRS ETF]: http://traderpau.files.wordpress.com/2009/07/2009-07-30-rth_prop.png