Daily Coffee Futures = July 2014

Coffee Forms 123 Top – Time to Short?

As you can see in the Daily Coffee chart below, Coffee Futures have completed a 123 top formation and we will wait for prices to break below the #2 point of 194.4 before we short the market.

The 50% Retracement Level from the last major move on the daily chart is 168.25.  That gives us plenty of down-side potential to profit on this trade.  Stay tuned!

Daily Coffee Futures = July 2014Monthly Coffee

Daily Cocoa chart  - July 2014

Cocoa Futures Breaking Thru Support?

Today, Cocoa Futures prices reached a new recent low of 2943 (at the time of this post).  We are short Cocoa Futures with a Put option (at a 2850 strike price) we purchased back on March 25 (see our post:  Shorting July Cocoa on 1-2-3 Top Formation).

When we shorted cocoa futures with our put option, we didn’t wait to see if the 1-2-3 top formation was going to ‘firm up’.  Looking at the Daily Cocoa chart below, you can see that today’s low so far of 2943 is pretty close to the #2 point of 2922 in the VERY WIDE 1-2-3 top formation that eventually formed over the past several weeks.  Wide 1-2-3 top and bottom formations usually indicate a strong and prolonged move in the market.  We expect if/when prices break below the #2 point of 2922 our 2850 strike price put option should be in the money soon after.  Stay tuned!

Daily Cocoa chart  - July 2014

Daily Coffee July 2014

Coffee Futures Makes New Multiyear High

Looking at the July 2014 Daily Coffee Futures chart below, you can see a new high was reached a couple days ago on 4/23/14.  Prices haven’t been this high since early 2012 (see Monthly Coffee chart below).

We wil look for a 1-2-3 top formation over the next several days and then short the Coffee Futures market.

Daily Coffee July 2014Monthly Coffee

Intraday High Grade Copper Chart

Going Long High Grade Copper on Breakout

Today, High Grade Copper futures gapped up (see Intraday chart below) and broke the the #2 point at 3.069 of the 1-2-3 bottom formation we have been watching.  See our previous post:  High Grade Copper Futures Form 1-2-3 Bottom

We purchased a 310 strike price July 2014 Call option for $2,037.50.  This option expires on 6/25/14.  Our initial target is the 50% Retracement on the July Daily chart of 3.13.  If prices shoot past that level, we next will look to reach the 50% Retracement level of 3.20 as shown on the Weekly chart (see below).

Intraday High Grade Copper ChartDaily High Grade Copper chart - July 2014Weekly High Grade Copper

 

Daily High Grade Copper chart - July 2014

High Grade Copper Futures Form 1-2-3 Bottom

We’ve been watching High Grade Copper futures (see our previous post: New Multiyear Low in Copper Reached Yesterday) and now a wide 1-2-3 bottom has formed over the past several weeks. See the July Daily High Grade Copper chart below.

We will be going long High Grade Copper when prices break above the #2 point of 3.069 on the July chart.   The 50% Retracement Level on the daily chart is 3.13, which doesn’t give us a lot of upside potential, but we also have the 50% Retracement Level of 3.20 as shown on the Weekly High Grade Copper chart (see below).

Daily High Grade Copper chart - July 2014Weekly High Grade Copper

Daily Lean Hogs

Taking Profits in Lean Hogs

June Lean Hog prices dropped as low as 115.925 today before bouncing back up to ~117 at the time of this post.  We were short Lean Hogs with a 1200 strike price Put option we bought for $1040 (see our previous post: Shorting Lean Hog Futures with a Put Option).  Today we sold this option for $2400 and exited the market, since our target was the 50% Retracement Level of 115.50 and prices almost touched that level today.

We profited $1360 in 6 days with this trade – a 131% ROI!

Daily Lean Hogs

Shorting Lean Hog Futures with a Put Option

We have been watching Lean Hog Futures (see our previous post: Lean Hog Futures Form 1-2-3 Top Formation?) and today, prices dipped below the #2 point of 123.00, going as low as 121.90 (June contract) before bouncing back up to currently ~124.00.

Since we’ve been planning to short this market when the above event occurred, we bought a June Lean Hogs Put option with a strike price of 1200 (2 strike prices out of the money) for $1040.00.  This option expires on June 17th, 2014.  Our target is the 50% Retracement Level of 115.50 on the Daily chart (see previous post).