Daily High Grade Copper futures - July2014

Taking Profits in High Grade Copper

We sold our July High Grade Copper futures contract yesterday at 3.21.  We were long from our 310 strike price option we exercised (see previous posts: Copper) , yielding us $2750 (we were long from 310, sold at 321, so we made 11 points x $250/point).  Since we paid $2038 premium for our 310 July call option, so we made a net profit of  $712.00 or made 35% ROI on this trade.

 

Daily Cocoa futures chart - Sept 2014

We Just Shorted Cocoa Futures – 3rd Time is the Charm

Cocoa futures hit a new multiyear high back on July 3rd, and we’ve been waiting on a 123 top formation to short Cocoa futures (see previous post: Cocoa Hits Multiyear High).   We just bought a Sept. 2014 Cocoa Put option with a 300 strike price for $290.  As you can see in Daily Cocoa futures chart below, prices closed just below the #2 point of 3085 yesterday, and today they continued edging lower closing out the day at 3055.

The 50% Retracement on the Daily chart (see below) is at 300.5,  so our 300 strike price put option will be at the money if prices drop another 50 points.  HOWEVER, the 50% Retracement on the Weekly Cocoa futures chart (see below) is 2598, meaning this trade for such small risk ($290) could net us huge gains!

This will be the 3rd time we’ve shorted Cocoa futures with an option, but the previous 2 times our options expired worthless and out of the money.   Prices have to drop eventually, so 3rd time is the charm!

Daily Cocoa futures chart - Sept 2014 Weekly Cocoa futures chart

Weekly Corn

Corn Hits New Multiyear Low

Back in January this year, Corn futures had reached as low as 408 (see Weekly Corn futures chart below).   Today, September Corn futures hit as low as 397.50, making it a new low (the last time prices dipped below 400 was in 2010).

We are going to be watching for a 123 bottom formation before going long the Corn market.  Stay tuned!

Weekly Corn

Daily High Grade Copper futures - July2014

Copper Takes Off – Moving Our Stop-Loss to Lock in Profits

Boy, are we glad we exercised our High Grade Copper July Call Option and are long Copper futures from 3.10 because over the last few days, Copper prices have shot up to ~3.27 (at the time of this post).   See Daily High Grade Copper chart below.

Previously, we put our Stop Loss at 309  (just below the support level of 3.0985 – see previous post:  Exercising Our Copper Option And Going Long).   Now that prices have shot up, we want to lock in those profits so we called our broker and had him move our stop-loss to just below the support level of 3.147 at 3.14.   If prices continue to rise, we will gradually move our Stop Loss up to lock in more profits.

Daily High Grade Copper futures - July2014