This is the September 2019 Monthly Recap of the Trade Spotlight: Options advisory segment.
Sugar Call (8/26/19)
Long the March 2020 Sugar 13.25 call option on 45 points or $504. Option settled at 55 points. Marked-to-market gain of $112. HOLD.
The March 2020 Sugar contract broke out to the upside through an upper trend line. The upside target of the 13.00 price level, a potential resistance level, is fast approaching. At that time the option may be liquidated for a profit even though there is plenty of time until option expiration (2/17/20). If there is follow through the next upside target is the 200-day Moving Average (13.38). The price alert to potential liquidate has been raised just below the 50-day Moving Average (12.51).
Heating Oil Bull Call Spread (8/21/19)
Long the November 2019 Heating Oil 1.95 / 2.00 call spread on 165 points or $693. Option spread settled at 139 points.Marked-to-market loss of $109.20. HOLD.
The order to liquidate the spread at 330 points or $1,386 for a gain of $693 is still working. The exit was just missed as the spread traded as high as 326 points. The exit order was placed after the conflict in the Middle East which pushed the Heating Oil futures market to gap open and trade about 1.100 points higher. The market has since sold-off down to the support level, a 50-day Moving Average (1.8937). The option expiration is October 28 so an exit will come in the next couple weeks either way. Watching for one more push high off the support level.
Nasdaq Bear Put Spread (9/23/19)
Long the December 2019 mini Nasdaq 7800/ 7700 put spread on 36.0 points or $720. Spread settled at 42.0 points. Marked-to-market gain of $120.
A put spread was initiated on the breakout of the Inverted Head & Shoulders Formation. By using options the risk and margin requirements were minimized in this volatile futures contract. The downside target is the 200-day Moving Average of 7,433.00. The option expiration date is December 20, 2019 so there is plenty of time to hold the position. This position will be held on any retracements due to recession fears and potential presidential impeachment which creates uncertainty tin the stock market.
Natural Gas Credit Put Spread (7/24/19)
Liquidated the short October 2019 Natural Gas 2.150 / 1.900 put spread at 50 points or $500 on 2 ticks (9/16/19) for a gain of $480.
The target was triggered when the October 2019 Natural Gas traded through the 200-day Moving Average and the Stochastics indicator was “overbought.” The position was liquidated with little value remaining to profit and eliminate the gamma risk.
Try Trade Spotlight Suite – for 3 Months
Trade Spotlight Suite – Trial - The Trade Spotlight advisory service consists of three segments covering futures, futures spreads, and commodity options. At the end of each trading day the commodity markets are analyzed by applying our methodology and recommendations are delivered to you based on our trading philosophy. Our technique is to track specific chat patterns for breakouts and apply key technical indicators to confirm the trade setup.
This material is conveyed as a solicitation for entering into a derivatives transaction.
This material has been prepared by a Daniels Trading broker who provides research market commentary and trade recommendations as part of his or her solicitation for accounts and solicitation for trades; however, Daniels Trading does not maintain a research department as defined in CFTC Rule 1.71. Daniels Trading, its principals, brokers and employees may trade in derivatives for their own accounts or for the accounts of others. Due to various factors (such as risk tolerance, margin requirements, trading objectives, short term vs. long term strategies, technical vs. fundamental market analysis, and other factors) such trading may result in the initiation or liquidation of positions that are different from or contrary to the opinions and recommendations contained therein.
Past performance is not necessarily indicative of future performance. The risk of loss in trading futures contracts or commodity options can be substantial, and therefore investors should understand the risks involved in taking leveraged positions and must assume responsibility for the risks associated with such investments and for their results.
Trade recommendations and profit/loss calculations may not include commissions and fees. Please consult your broker for details based on your trading arrangement and commission setup.
You should carefully consider whether such trading is suitable for you in light of your circumstances and financial resources. You should read the "risk disclosure" webpage accessed at www.DanielsTrading.com at the bottom of the homepage. Daniels Trading is not affiliated with nor does it endorse any third-party trading system, newsletter or other similar service. Daniels Trading does not guarantee or verify any performance claims made by such systems or service.