OPTION TRADE OF THE DAY!
July Cotton upswing today completes a Fibonacci retracement as the market heads into a seasonally weaker time period. Cotton prices on average sell off from late February early March into the summer. We are buying the 71/66 bear put spread with a naked leg using the 80 call. The trade is being filled at a $300 credit. The risk on the trade is above 80.60 where you have the same risk as being short from that level. Under 80 the trade would be profitable by the premium collected minus commissions, if the market is under 66, the trade has limited profit potential of 500 points or $2500 plus premium credit collected less transaction costs.
Please contact us with any questions or if you need assistance putting this trade together.
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