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1. Market Commentary
2. Futures Support and Resistance Levels – S&P, Nasdaq, Dow Jones, Russell 2000, Dollar Index
3. Commodities Support and Resistance Levels – Gold, Euro, Crude Oil, T-Bonds
4. Commodities Support and Resistance Levels – Corn, Wheat, Beans, Silver
5. Futures Economic Reports for Thursday February 4, 2016
Hello Traders,
For 2015 I would like to wish all of you discipline and patience in your trading!
Market Strategies 1. Bullish Market Strategies
| Futures Options Trading Spread Strategy |
Description | Reason to Use | When to Use |
|---|---|---|---|
| Buy a call | Strongest bullish option position | Loss limited to premium | Undervalued option with volatility increasing |
| Sell a put | Neutral bullish option position | Profit limited to debt | Small debit, bullish market |
| Vertical Bull Calls | Buy call, sell call of higher strike price | Loss limited to debt | Small debit, bullish market |
| Vertical Bull Puts | Buy put, sell put of higher strike price | Loss limited to price difference | Large credit, bullish market |
2. Bearish Market Strategies
| Futures Options Trading Spread Strategy |
Description | Reason to Use | When to Use |
|---|---|---|---|
| Buy a put | Strongest bearish option position | Loss limited to premium | Undervalued option with volatility increasing |
| Sell a call | Neutral bearish option position | Profit limited to premium | Option overvalued, market flat, bearish |
| Vertical Bear Calls | Buy at the money put, sell out of the money put | Loss limited to debt | Small debit, bearish market |
| Vertical Bear Puts | Sell call, buy call of higher strike price | Loss limited to stroke price difference minus credit | Large credit, bearish market |
3. Neutral Market Strategies
| Futures Options Trading Spread Strategy |
Description | Reason to Use | When to Use |
|---|---|---|---|
| Strangle | Sell out of the money put and call | Maximum use of time value decay | Trading range market with volatility peaking |
| Arbitrage | Bull and sell similar simultaneously | Profit limited to debt | Any time credit received |
| Calendar | Sell near month, buy far month, same strike price | Near month time value decays faster | Small debit, trading range market |
| Butterfly | Buy at the money call (put), sell 2 out of the money calls (puts), buy out of the money call (put) | Any time credit received | |
| Guts | Sell in the money put and call | Receive large premium | Futures Options have time premium and market in trading range |
| Box | Buy at the money put, sell out of the money put | Small debit, bearish market | |
| Ratio Call | Buy call, sell calls of higher strike price | Neutral, slightly bullish | Large credit and difference between stroke price of option bought and sold |
| Conversion | Buy futures, buy at the money put, and sell out of the money call | Any time credit received |
Trading Futures, Options on Futures, and retail off-exchange foreign currency transactions involves substantial risk of loss and is not suitable for all investors. You should carefully consider whether trading is suitable for you in light of your circumstances, knowledge, and financial resources. You may lose all or more of your initial investment. Opinions, market data, and recommendations are subject to change at any time.
| Contract March 2016 | SP500 | Nasdaq100 | Dow Jones | Mini Russell | Dollar Index |
| Resistance 3 | 1970.92 | 4349.00 | 16832 | 1052.33 | 100.54 |
| Resistance 2 | 1941.58 | 4282.00 | 16567 | 1034.47 | 99.75 |
| Resistance 1 | 1923.67 | 4224.50 | 16406 | 1020.83 | 98.47 |
| Pivot | 1894.33 | 4157.50 | 16141 | 1002.97 | 97.68 |
| Support 1 | 1876.42 | 4100.00 | 15980 | 989.33 | 96.40 |
| Support 2 | 1847.08 | 4033.00 | 15715 | 971.47 | 95.61 |
| Support 3 | 1829.17 | 3975.50 | 15554 | 957.83 | 94.33 |
| Contract | Apr. Gold | March Silver | Mar. Crude Oil | Mar. Bonds | March Euro |
| Resistance 3 | 1171.6 | 15.46 | 36.72 | 165 24/32 | 1.1456 |
| Resistance 2 | 1158.9 | 15.14 | 34.64 | 165 | 1.1306 |
| Resistance 1 | 1150.2 | 14.91 | 33.57 | 163 22/32 | 1.1214 |
| Pivot | 1137.5 | 14.59 | 31.49 | 162 30/32 | 1.1064 |
| Support 1 | 1128.8 | 14.36 | 30.42 | 161 20/32 | 1.0971 |
| Support 2 | 1116.1 | 14.04 | 28.34 | 160 28/32 | 1.0821 |
| Support 3 | 1107.4 | 13.81 | 27.27 | 159 18/32 | 1.0729 |
| Contract | Mar. Corn | Mar. Wheat | Mar Beans | Mar. SoyMeal | March Nat Gas |
| Resistance 3 | 375.8 | 487.3 | 893.42 | 278.97 | 2.15 |
| Resistance 2 | 374.5 | 483.7 | 889.08 | 276.83 | 2.11 |
| Resistance 1 | 372.8 | 481.8 | 882.92 | 273.47 | 2.08 |
| Pivot | 371.5 | 478.2 | 878.58 | 271.33 | 2.04 |
| Support 1 | 369.8 | 476.3 | 872.4 | 268.0 | 2.0 |
| Support 2 | 368.5 | 472.7 | 868.08 | 265.83 | 1.96 |
| Support 3 | 366.8 | 470.8 | 861.92 | 262.47 | 1.93 |
source:http://www.forexfactory.com/calendar.php
All times are Eastern time Zone (EST)
| Date | 4:13pm | Currency | Impact | Detail | Actual | Forecast | Previous | Graph | |
|---|---|---|---|---|---|---|---|---|---|
| ThuFeb 4 | 2:15am | USD | FOMC Member Rosengren Speaks | ||||||
| 3:00am | EUR | ECB President Draghi Speaks | |||||||
| 4:00am | EUR | ECB Economic Bulletin | |||||||
| 4:10am | EUR | Retail PMI | 49.0 | ||||||
| Tentative | EUR | Spanish 10-y Bond Auction | 1.46|2.6 | ||||||
| Tentative | EUR | French 10-y Bond Auction | 0.86|1.4 | ||||||
| 7:30am | USD | Challenger Job Cuts y/y | -27.6% | ||||||
| 8:30am | USD | Unemployment Claims | 279K | 278K | |||||
| USD | Prelim Nonfarm Productivity q/q | -1.5% | 2.2% | ||||||
| USD | Prelim Unit Labor Costs q/q | 3.9% | 1.8% | ||||||
| 10:00am | USD | Factory Orders m/m | -2.5% | -0.2% | |||||
| 10:30am | USD | Natural Gas Storage | -170B | -211B |
This is not a solicitation of any order to buy or sell, but a current market view provided by Cannon Trading Inc. Any statement of facts here in contained are derived from sources believed to be reliable, but are not guaranteed as to accuracy, nor they purport to be complete. No responsibility is assumed with respect to any such statement or with respect to any expression of opinion herein contained. Readers are urged to exercise their own judgment in trading.