The correct answer is A. Allergic contact dermatitis to a soap or other topical application.
The sharp demarcation and linear almost “dripping” of the proximal aspect of the dermatitis suggest an allergic contact dermatitis particularly to a topical application. Often stronger steroids than a 1% hydrocortisone are needed.
Irritant contact dermatitis is less pruritic, and less well-demarcated. Allergic dermatitis to a metal and psoriasis both will not be as well-demarcated and geometric. A phototoxic drug eruption could unlikely be on the hip and nowhere else, and is unlikely to have that “dripping” seen.
Bolognia, Jean., Jorizzo, Joseph L.Schaffer, Julie V. (Eds.) (2012) “Allergic Contact Dermatitis.” Dermatology /[Philadelphia] : Elsevier Saunders.