When a market goes up and up there comes a time where the worries begin to surface. We are slowly reaching that point in this market as we have crawled higher now since the beginning of the year but have been unable to even test the S&P highs from last year as of yet. Close but no cigar. Such a set-up into the beginning of earnings season begs for a smacking. What I mean by that is that it only takes one big name to miss and/or to guide badly which then gets used as the excuse to sell because "all" companies have the same issue. Rightly or wrongly, if you can't test or you test and can't break key levels, the market will find an excuse to sell down. That's where we are and that is a possibility more so now than the past week or two.

That doesn't mean it will happen but it certainly could and if you are long and strong then that has to be part of your game plan. Do you just sit through it. Do you buy if it happens. Do you short and hedge some? You have to look at the situation and decide for yourself given your risk preference and your sense of where we are in this larger move as well as your making sure you know the time frame you are trading on.

That's not something someone else can answer for you. It's a question you have to ponder and answer yourself. As for me, I'm not willing to do a lot about the downside protection other than intraday. This market still on a mission it seems and it's just a matter of time.