OPTION TRADE OF THE DAY!
March Dow Jones- We are reversing our Bull Call Spread in the Dow. We feel the market has become extremely over bought and needs to fulfill its Fibonacci requirements which could bring the index down to the 10,000 area before March. We are buying the June 10500put, selling the June 10200 put and also selling the 11000 calls, you can use either the 5 or 10 dollar Dow. Based on the mini this spread is currently a credit spread of $200+, so as long as the Dow doesn’t go over the naked call this trade would be profitable. Above 11000 the trade has unlimited risk, the profit potential is limited to 300 point (x$5) plus premium ($200) collected minus commissions.
PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS
There is a substantial risk of loss in trading futures and options.
PLACING CONTINGENT ORDERS SUCH AS “STOP LOSS” OR “STOP LIMIT” ORDERS WILL NOT NECESSARILY LIMIT YOUR LOSSES TO THE INTENDED AMOUNTS. SINCE MARKET CONDITIONS MAY MAKE IT IMPOSSIBLE TO EXECUTE SUCH ORDERS.
Past performance is not indicative of future results.
The information and data in this report were obtained from sources considered reliable. Their accuracy or completeness is not guaranteed and the giving of the same is not to be deemed as an offer or solicitation on our part with respect to the sale or purchase of any securities or commodities.. Any decision to purchase or sell as a result of the opinions expressed in this report will be the full responsibility of the person authorizing such transaction.
FOR CUSTOMERS TRADING OPTIONS, THESE FUTURES CHARTS ARE
PRESENTED FOR INFORMATIONAL PURPOSES ONLY. THEY ARE
INTENDED TO SHOW HOW INVESTING IN OPTIONS CAN DEPEND ON
THE UNDERLYING FUTURES PRICES; SPECIFICALLY, WHETHER OR NOT
AN OPTION PURCHASER IS BUYING AN IN-THE-MONEY, AT-THE-MONEY,
OR OUT-OF-THE-MONEY OPTION. FURTHERMORE, THE PURCHASER
WILL BE ABLE TO DETERMINE WHETHER OR NOT TO EXERCISE HIS
RIGHT ON AN OPTION DEPENDING ON HOW THE OPTION’S STRIKE
PRICE COMPARES TO THE UNDERLYING FUTURE’S PRICE. THE FUTURES CHARTS ARE NOT INTENDED TO IMPLY THAT OPTION PRICES
MOVE IN TANDEM WITH FUTURES PRICES. IN FACT, OPTION PRICES MAY ONLY MOVE A FRACTION OF THE PRICE MOVE IN THE UNDERLYING
FUTURES. IN SOME CASES, THE OPTION MAY NOT MOVE AT ALL OR
EVEN MOVE IN THE OPPOSITE DIRECTION OF THE UNDERLYING FUTURES CONTRACT.
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Whitehall Investment Management
Commodity Trading School