Synopsis
Reginald doesn't understand the TRACE option you specified after the TRACE keyword. You must supply one of Reginald's supported options. Reginald lists the TRACE options it supports as choices in the error message. What you supplied was bad trace setting, and that isn't supported by Reginald.
Cause
You forgot to put quotes around the options, and therefore Reginald thought that the options you specifed was a variable name where you've stored what you really want for the options. This is likely the case if you see that bad trace setting is nothing like what you thought that you were specifying to TRACE.
Cure
If you are specifying the options directly after the TRACE keyword, then put quotes around them.
Cause
You misspelled the option. Check that bad trace setting is exactly what you wanted,
Cure
Learn to type, garlic-breath. Go on a diet so that your pudgy fingers don't press the wrong keys.
Cause
bad trace setting is indeed the setting you want. But, Reginald doesn't support this (ie, the choice you want is not listed under choices).
Cure
Update to the latest version of Reginald at Reginald's web site.