TRADING COMMODITY FUTURES AND OPTIONS INVOLVES SUBSTANTIAL RISK OF LOSS AND MAY NOT BE SUITABLE FOR ALL INVESTORS. YOU SHOULD CAREFULLY CONSIDER WHETHER TRADING IS SUITABLE FOR YOU IN LIGHT OF YOUR CIRCUMSTANCES, KNOWLEDGE AND FINANCIAL RESOURCES. 

 

OPTIONS PLAY: NYBOT Sugar Not So Sweet

 This article will focus on buying NYBOT SUGAR puts as the market falls from it’s apparent overbought condition.

MY ANALYSIS

Fundamentally,  NYBOT SUGAR FUTURES fell sharply today (11/12/10) likely due to weakness in in the Euro Zone and speculation that China will raise interest rates curbing demand for commodities.

Technically, I see NYBOT SUGAR FUTURES in a near term DOWNWARD trend indicated by the 9 period Moving Average pointing  lower and the market falling sharply below the MA. In my opion the next area of support could be at about 22 cents per pound and then 18 cents per pound. Also notice the increased volume on this long liquidation. See daily chart below. Additional charts, studies, and commentary can be found at http://markethead.com/2.0/free_trial.asp?rid=McKinney

96e2c9d696b99ea8e2000612640a448f.png

 

OPTIONS PLAY

BUY PUTS

We also buy in a 3 to1 ratio an outright CALL in case the market makes a MAJOR move against us.

FOR A FREE CME REPORT ON OPTION BASICS CLICK HERE:http://www.zaner.com/3.0/mmck5.asp

WE ARE ALSO FOCUSING ON COMMODITY OPTIONS IN U.S. 30 YEAR TREASURY BONDS, GOLD, OIL, GRAINS, SOFTS, and INDICES.    

FREE QUOTE- “Second Place Is Really The First Loser.”    -George Steinbrenner, The Boss

 Before you place any of these trades in your account you should call or email me with your phone number for a detailed explanation of the strategies and the risks involved at 312-277-0115 or  mmckinney@zaner.com.                               

Futures, options and forex trading is speculative in nature and involves substantial risk of loss. All known news and events have already been factored into the price of the underlying commodities discussed. The limited risk characteristic of options refers to long options only; and refers to the amount of the loss, which is defined as premium paid on the option(s) plus commissions.

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