Crude Oil Super Down Trend, Options Play for Next Wave Down
Commodities / Options & Warrants Dec 17, 2009 - 01:42 AM GMTBy: Matt_McKinney
This Article Focuses On Buying Bear Put Spreads in CRUDE OIL
MY ANALYSIS
Fundamentally, OPEC has raised it's demand outlook for the coming year possibly causing the recent bounce in price. This rally is very unimpressive to me allowing for an opportunity to buy puts.
Technically, this market remains in a SUPER-TREND DOWN. See daily chart below.
WE ARE BUYING MARCH PUT SPREADS LOOKING FOR LOWER PRICES IN CRUDE OIL!
OPTIONS PLAY
MARCH CRUDE-74.17/BARRELL
OPTION EXPIRY-FEB 17TH
CONTRACT SIZE-1,000 BARRELLS
LEVERAGE FACTOR $1=$1,000
BUY THE MARCH CRUDE 64-59 PUT SPREADS
We also buy in a 3 to 1 ratio an outright CALL in case the market makes a MAJOR move against us.
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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
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