We are in a new quarter, and a new season. Chicago even got a teaser of spring for baseball’s Opening Day on the South Side.
Like being a good hitter consistency is a key to being a successful trader. Home Run hitters knock it out of the park every once in a while. They also strike out a lot. Hitting singles and doubles will get you on base and keep you in the line up every day.
The beginning of the week brought us the end of the first quarter of 2014. The 2013 rally got knocked down a bit to start the year, trending lower into the beginning of February. After putting in the low the first week of February (1732), the S&P 500 futures have put in a new high 11 times. The previous four sessions have closed higher, something we haven’t seen since in almost two months. The contract is trading near all time highs near 1886 as I write this. This rally has sustained its upside move while the Fed continued its taper program and brought in a new Fed Chair as well.
I had been looking for a downside move towards the end of the first quarter, it arrived a bit earlier than I had expected. Many traders and investors looked at the correction as an opportunity to get in (or back in) a bull market. We still have downside risk, but I think we will continue to see an influx of buyers into the current run.
BULLISH E-MINI PLAY
As we start the second quarter, I am looking at a bullish play that will take us into the early third quarter. I like buying the June E-Mini S&P 500 1900-1920 call spread at 9 points or better. Risk is limited to the cost of entry ($450.00) plus fees and commissions. I would like to ride this all the way into expiration (6/20/14) and try and achieve full value. If the S&P 500 is not trading above 1900 10 days from expiration I would look to exit at and minimize a loss.
GRAINS WEBINAR
For those interested in grains, Walsh Trading’s Senior Grain analyst Tim Hannagan hosts a free grain webinar each Thursday at 3:00 p.m. central time. Tim has been ranked the #1 grain analyst in the United States per Reuters and Bloomberg for his most accurate price predictions for soybeans and corn in the years 2011 and 2012. Link for next week’s webinar is below. If you cannot attend live, a recording will be sent to your email upon signup. Or please contact me at anytime (e-mail information is below).
RISK DISCLOSURE: THERE IS A SUBSTANTIAL RISK OF LOSS IN FUTURES AND OPTIONS TRADING. THIS REPORT IS A SOLICITATION FOR ENTERING A DERIVATIVES TRANSACTION AND ALL TRANSACTIONS INCLUDE A SUBSTANTIAL RISK OF LOSS. THE USE OF A STOP-LOSS ORDER MAY NOT NECESSARILY LIMIT YOUR LOSS TO THE INTENDED AMOUNT. WHILE CURRENT EVENTS, MARKET ANNOUNCEMENTS AND SEASONAL FACTORS ARE TYPICALLY BUILT INTO FUTURES PRICES, A MOVEMENT IN THE CASH MARKET WOULD NOT NECESSARILY MOVE IN TANDEM WITH THE RELATED FUTURES AND OPTIONS CONTRACTS.
