UPDATE Trade: RDY short via puts - loser

UPDATE 31-JUL-10: Got stopped out with the trade triggers. This was largely due to the wide bid ask spread on these puts. My triggers are based on the bid...I wish I could enter them based on the mid (please look into this TD). Regardless, you trade illiquid products and this is what you invite.

Sold 5 contracts for $5.80 each, loss of $350. Tough, but not that bad...

%R is still intact.

Charts...

Daily:

4HR:

26-JUL-10:RDY retested on Friday and I decided to pull the trigger on some puts...these weren't very liquid yet I got decent fill prices.

23-JUL-10: On the taxable account picked up 5 of the Sep $35 puts for $6.70, in the IRA and my sister's IRA I picked up 3 of these for $6.50 each.

Current stop is $28.95

Psychologically this wasn't very easy since the SPX was breaking 1100 and further confirming the rally...so being short isn't fun during a rally. However, RDY had reported crappy earnings the day before and it sold off pretty hard on that news...so Friday's action was a classic short covering retest...plus it was a fresh breakout below the bands and confirming on %R at the same time...so this retest gave me confidence to trade it.

Charts:

Daily:

4hr: