OPTION TRADE OF THE DAY!
5-03-10
July Crude Oil could be running out of steam at this level which also coincides with the top of its current trading range. We are buying the July 8700/8400 bear put spread and selling the July 9500 call as our naked leg. The trade is being filled at a $300 credit which places our intrinsic risk; which is unlimited, above 95.00. Under 95 but above 87 our profit potential is limited to the premium collected minus transaction costs, under 84.00 the trade would be worth $3,000 plus the credit.
July British Pound Put Spread-Using the July options which are based on the September Futures contract we are seeing the following potential opportunity. The Pound has recently retraced its last sell-off and could start another wave of selling bring the market down to the mid 140’s in this next progression. We are buying the JULY 151/147 bear put spread and selling the July 158 call as a naked leg, we are getting filled on the spread for less than $20 which mean that the risk under 158 is limited to that amount plus transaction costs, above 158 the risk is unlimited. The profit potential is limited to 4 handles or $2500 with the market below 147.
September T-Bond Put Ratio- This is actually a counter trend trading technique which are going to use to ride out this area in the Bonds. We are still bearish the bonds however they seem to be trapped in a sideways trading range. Buy the September 117 put and sell 2 114 puts, the trade is getting filled at a $100 credit so there is virtuously no risk on the upside, on the down side this trade would be worth the most at 114 on expiration, with about $3,000, under 114 the trade starts “giving back” the profits running out at 111, so under 111 there is unlimited risk.
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.
To be removed email paul@binvstgrp.com with REMOVE as the subject
Paul Brittain
Whitehall Investment Management
Commodity Trading School
877-270-8403
Paul Brittain
Commodity Trading School
877-270-8403
702-463-0718
info@commoditytradingschool.com
paul@binvstgrp.com
