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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. In 2000 he established 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. For more information on Matt's trading, please visit www.targetfutures.com. |
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The short side of the Euro Currency still looks promising. In the September options, I like an ECU8 154/151 Put spread for approximately 60 points ($750) with a 5:1 risk reward ratio. You can sell an ECU8 161 Call for about 50 points to help pay for the trade.
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Has the tide turned for the long haul in the crude market? There are still plenty of things that can turn things around, but for now, the path of least resistance is down. In the September options, I like a CLU8 115/110 Put spread for approximately 100 points ($1000) with a 5:1 risk reward ratio. You can sell a CLU8 140 Call for 100 points as well to pay for the trade.
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The grains have been beaten up the past few weeks, but they seem to be finding some support, especially the wheat market. In the September options, I like a WU8 850/900 Call spread for approximately 10 cents ($500) with a 5:1 risk reward ratio. I'm a little concerned about further selling, so I would not suggest selling a put to pay for the trade.
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You can call this trade a hedge against my crude and Euro trades, but until the US dollar really finds some strength, gold will be heading higher. In the October options, I like a GCV8 990/1040 Call spread for 10 dollars ($1000) with a 5:1 risk reward ratio. You can sell a GCV8 840 Put for about 6 dollars to help pay for the trade.
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Oh I want to be bullish on the stock market, but sadly this looks like nothing more than a bear market rally to me. In the August options based on the September futures, I like an ESQ8 1230/1200 Put spread for 8 points ($400) with an almost 4:1 risk reward ratio. You can sell an ESQ8 1300 Call for 6 points to help pay for the trade.
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Eric Reinholtz is a Senior Market Strategist with DAW Trading. Mr. Reinholtz relies heavily on his expertise in charting markets for his exact entry and exit scenarios. Mr. Reinholtz's focus targets very realistic money-making strategies more so than cryptic buy & sell signals that can get flashy publicity, but have little to do with actual portfolio alignment. He believes a professional way of approaching the markets should emphasize scaling-in during serious purges (ideally after bases are built), and scaling-out gradually into strength (ideally into extended parabolic moves), happily not worrying about "milking" the last percent out of a move.
