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| 5 Hot Picks by Matt Johnson of Target Futures |
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 In the futures industry since 1996, Matt Johnson got his start working with retail clients at Lind Waldock and Man Financial. In 2000 he established Cytrade Futures Inc. which later became Cytrade Financial, L.L.C., and independent introducing broker registered with the CFTC and NFA member. Matt manages the firm and offers his brokers and clients trading suggestions primarily using futures options.
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| Things are looking promising for a dollar recovery in the short term. Traders in the Yen options pit don't seem convinced though as the puts are trading with a very low implied volatility and the calls very high. JYM8 95 Puts are trading for approximately $900, and you can sell a JYM8 109 Call for approximately $500 to help pay for this if you're willing to take some upward market risk. |
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| The fundamentals of the last week's rally seem dubious at best, and I think the crude market will turn back soon in this $100-110 trading range. May options don't have a lot of time left, but this makes their pricing attractive. I like a CLK8 108/104 Put spread for approximately $1300 with a 3:1 risk reward ratio. It's a little lower than I normally look for, but it's also very close to the current market price. |
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| The corn chart is looking a little toppy at these levels, and I think we're looking at a bit of a pullback ahead of another rally in the coming months. A CK8 590/560 Put should be trading for about $500, and again this is only a 3:1 risk reward ratio, but close to the action. CK8 560 Puts are trading for approximately $350 for those thinking this correction might have some legs. |
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| I really do want to get excited about last week's rally, but I'm still in the "sell the rallies" camp in this market. An ESJ8 1360/1340 Put spread is trading for about $250 with a 4:1 risk reward ratio. For those a bit more ambitious, buy an ESJ8 1340 Put outright for approximately $400.
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| The cattle market has been beaten up pretty good in the last few weeks, and I think it's time for a recovery. A LCM8 92/96 call spread is going for approximately $400 with a 4:1 risk reward ratio. |
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| 5 Hot Picks by Drew Klein of Greenrush Capital |
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 Drew Klein is Principal of Greenrush Capital Management LLC, an introducing brokerage outside of Los Angeles, California. Drew has been a member of the National Futures Association in good standing since 2001 and has worked for some of the largest options firms on the West Coast. Greenrush specializes in managed accounts, full-service retail brokerage, and self-directed trading for the more sophisticated client. Drew is the editor of Greenrush Capital Research, which is available on a subscription basis but is
complimentary to all clients trading with Greenrush Capital. | |
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Stocks are maintaining technical strength and continue to shrug off bad news. With Uncle Benny assuring us that we are heading into a potential 'R-word', the buying of the fact may be the case here in the short term (we already sold the rumor). Look for the ESM8 to make inroads and find strong resistance at around 1403. A sharp run towards 1440 should not be ruled out, as bear market rallies continue to confound the weak shorts. 1360 level may act as very strong support. |
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Chop, slop and consolidate. That seems to be the mantra for the long end of the yield curve these days, as we have grinded sideways/higher over the last 4 months. With 30 year yields hitting the low 4% range in March (4.16%), be aware that this is the area from which they have historically bounced higher. Shorting the 120 area and buying the 115 area may continue to prove profitable as a range trade until we break-out of this sideways pattern. The short end of the curve should firm up, with the Fed getting ready to fire its final remaining bullets. |
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The significant correction in precious metals over the last 3 weeks may be coming to an end. Gold fell $150/oz and silver almost $5/oz from top to bottom, with both markets bouncing sharply off their 100 day moving averages. One of the trades that we see as having the best upside potential is a long silver/short gold futures spread, which we think can run about $6,000 per spread higher over the next month or so, as silver catches back up with the yellow metal. This is a volatile trade, so those looking to just be long should consider call spreads out until December. |
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Rekindling of Middle East tensions, with Israeli and US militaries preparing for something, and Iran and Syria on edge, has us considering the recent breakout in the energies as a potential barnburner. A break and close above the most recent swing highs in crude gives us targets of $112.75, $117.25 and $122.90 / barrel. Remember that all technical resistance is purely technical and not really resistance. RBOB Gasoline fundamentals are terribly weak, but the price action is not, so we remain cautiously bullish. Natural Gas may be poised to run to the mid $11.00 area over the next month or so. |
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All hell should break loose this summer in the grain markets, as the crops continue to fight for acreage in spite of the USDA's most recent prospective planting report. Fears of a rare wheat blight are being tossed around by a few analysts we know, and that has the potential to cause even more dislocation over the long run. We like bear spreading beans here (buying November, selling May) and maintaining length in corn and soymeal until the charts tell us otherwise. Cotton could easily break $1.00 this summer. Look for markets with relatively low implied volatility (the lowest now is oats) and buy option straddles through the growing season.
DISCLAIMER - THE RISK OF LOSS IN TRADING COMMODITIES CAN BE SUBSTANTIAL. YOU SHOULD THEREFORE CAREFULLY CONSIDER WHETHER SUCH TRADING IS SUITABLE FOR YOU IN LIGHT OF YOUR FINANCIAL CONDITION. PAST PEFORMANCE IS NOT INDICATIVE OF FUTURE RESULTS.FUTURES & FUTURES OPTIONS TRADING IS COMPLEX AND CAN EXPOSE YOU TO UNLIMITED RISK. NONE OF THE TRADES DISCUSSED TAKE INTO ACCOUNT FEES, COMMISSIONS, OR SLIPPAGE, ALL OF WHICH CAN NEGATIVELY IMPACT YOUR TRADING RESULTS. ALL TRADE CONSIDERATIONS LISTED BELOW ARE MERELY IDEAS THAT ARE SUBJECT TO CHANGE BASED ON MARKET FACTORS. CONSIDERATIONS MAY HAVE NOT YET BEEN AND MAY NEVER BE EXECUTED BY GREENRUSH CAPITAL MANAGEMENT, LLC. NOT ALL
ACCOUNTS ENTER AND EXIT TRADES AT THE SAME LEVELS, THEREFORE THE REPORTED PROFITS OR LOSSES ARE AN APPROXIMATE AVERAGE OF ALL TRADES TAKEN AND ARE NOT ADJUSTED FOR COMMISSIONS OR FEES. INFORMATION PROVIDED IS COMPILED BY SOURCES BELIEVED TO BE RELIABLE. GREENRUSH CAPITAL OR ITS PRINCIPALS ASSUME NO RESPONSIBILITY FOR ANY ERRORS OR OMISSIONS AS THE INFORMATION MAY NOT BE COMPLETE OR EVENTS MAY HAVE BEEN CANCELLED OR RESCHEDULED. ANY COPY, REPRINT, BROADCAST OR DISTRIBUTION OF THIS REPORT OF ANY KIND IS PROHIBITED WITHOUT THE EXPRESS WRITTEN CONSENT OF GREENRUSH CAPITAL MANAGEMENT, LLC. |
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