We made another run at the 16.60 after a 100+ point run this week since Monday morning.
It was able to break above yesterday. However, early this morning you see traded a bit lower.
It didn’t hold the first time, breaking below 16.40 and bouncing earlier this morning…but it has my attention that sellers have shown up!
I like the idea of selling on the next break below 16.60 while risking a new high. I will be buying a call option to help protect.
SELLING on a STOP order at 16.60 (GTC) …last traded 16.85
Risk will be the 17.20 level …($672.00, but we will also have the call option on)
Objective will be the 14.40 level …$2,464.00
(short term Obj will be 15.60 level …$1,120.00)
*** As mentioned above, ONCE FILLED, buy the 17.25 call for roughly 60 points ***
2 things on the extra call option for protection:
- If stopped out, we will exit the call option and apply profits to ease the futures loss.
- Once we can move the stop down to break-even or better and we can confirm we possibly have a move coming and the protection is no longer needed, we will exit the call for a small loss and look to make it up in the future trade.
If you choose to use JUST THE CALL OPTION WITH NO STOP, that’s ok too!
(you would be protected above 17.25 when this contract expires on 6/15)
Initial margin is $1478.00 per contract (adding the call option will cheapen that up)
Have a look:
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