Pretty quiet day with floor traders pointing out small trades on straddles indicating drop in straddle prices. This even though the Mar. 13 eurodollar contract rallied from 9777 to 9791 area overnight.
In the longer end seeing various strangles being sold, which of course profit if the market does not trend much moving forward. Daily chart does show this selloff has been pretty intensive – take note how the RSI has been below the over sold area for an extended period. With trading volumes expected to slow down as we are getting into holiday mode may allow these extreme readings to get alleviated with mostly sideways movement. The weekly picture does tempt one to put on some sort of long structure. See disclaimer then read on.
The information in these pages is for informational purposes only. The sources for the information including the exchanges themselves are deemed reliable by the writer. However the writer makes no representations or warranties as to the accuracy of the information in these reports. Commodity trading is very risky and before considering trading commodities you should consult with a bona fide financial professional. The CFTC nor the NFA nor the exchanges make any warranties as to these writings.
Given the thinner conditions of the market we expect next week and with the Fed doing some fairly sizable buy backs you may want to look at some Feb options which will expire the 3rd week of January. Or just trade the underlying with appropriate stop protection. Again will need the MACD to cross in order to confirm an up trend and that will not be happening today. So any longs should only be partial – say 25 to 50% of capital and adding only when a stop loss can be placed that guarantees a profit. That sort of thing.
Larger trades from a.m. session listed below.
| 12/17/2010 | |||||
| Paper | B | 2,000 | EDZ195/96/97 c fly | 2.5 | N/A |
| Paper | B | 1,000 | EDH12 9912 call | 21.5 | N/A |
| Locals | B/S | 1,000 | EDU1 9925 straddle | 46 | 9929 area |
| Straddle above setted 47.5 - trade indicates quiet market with premiums off!! | |||||
| New Edge | S | 10,000 | EDF/EDH 9962 p calendar | 4 | 9957.5/58 |
| Paper | B | 3,000 | EDH12 9912 call | 23.5 and 24 | 9891.5/92 |
| Paper | S | 800 | EDF 9950/9962 strad stupid | 24 and 23.5 | 9958.5 area |
| New Edge | B | 10,000 | EDZ1 9937/9962 c 1X2 | 8 and 8.5 | 9911.5/12 |
| Paper | B | 5,000 | EDH12 9950/9962.5 c sprd | 4 | 9891.5/92 |
| New Edge | B | 20,000 | EDH13 82/85/90 c 1X2X2 | 3 | 9791 area |
| Yesterday they bought size in the EDH13 82/85/91 c 1X2X2 @ 3…. | |||||
| 10yr. | |||||
| Merril | S | 500 | TYG 117/123 strangle | 0.43 | 11920.5/21 |
| CCM | B | 2,000 | TYF120.5/121/121.5 c fly | 0.03 | 11920.5 to 22 area |
| Smith B | S | 1,000 | TYG118/123 strangle | .60 and .59 | 11917 to 20 |
| RJO | B | 2,000 | TYH123c | 0.31 | ^120.5 and 20 |
| New Edge | S | 500 | TYH116/123 strangles | 1.03 | 11921/21.5 |
| JP Morg | B | 500 | TYF121/121.5/122/122.5 c condor | 3 | 11920/20.5 |
| Gelber | B | 1,000 | TYH114/117 p spread | .31 and .33 | 11920/22 |
| RJO | B | 1,500 | TYH123c | 0.31 | ^11921 and 21.5 |
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