I hate watching the market gap up a hundred points at the open and all my entry triggers hit because I know the rest of the day is not going to be pleasant.

We want the markets to open positive but just not post all the gains on the opening tick. The S&P gapped up to 1026.07 on the opening tick and never made it back to that level for the rest of the day. All of our new watch list entry triggers were hit at the open and that was the high of the day. I promise I won't complain if they keep going up but I always hate to be filled at the high of the day unless I am selling my longs.

Even though on all the new positions the stocks finished with gains the options on all but one closed higher than where we were filled. We saw the maximum deflation in premium at the open then premiums rose the rest of the day as the stock gains eroded. This is the worst of all possibilities for entering new positions.

To add insult to injury Travelers (TRV) gapped up to $50.44 to start the day and then dropped nearly $2 to stop us out at $48.75 and a 15-cent loss. The financial sector did not participate in the rally today and insurers in particular were hit by a downgrade of AIG by Credit Suisse. The downgrade was specific to AIG but it hurt the entire sector.

I have transferred TRV to the history sheet and added the new plays to the portfolio section. I adjusted the stop losses to account for the opening gap and hopefully the bulls will return in volume tomorrow.

No new plays tonight.

Jim Brown

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