Going Long Wheat Futures on Breakout

Today (February 12, 2014) Wheat Futures broke above the #2 point of 592.75 in the 1-2-3 Bottom Formation shown in the Daily Wheat chart below.  The #1 point is a multiyear low.  As of this writing, prices for the day have gone as high as 597.75 before coming back down to 589.25.

We are going long Wheat by buying a May 2014 Call option at a 605 strike price (3 strike prices out of the money) for $862.  This option expires on 4/25/204.  The 50% Retracement Level on the Daily Wheat chart is 635.38 and the 50% Retracement Level on the Weekly Wheat chart is 748.74 so this trade has plenty of upside profit potential.

Daily Wheat CBOT - March 2014Weekly Wheat CBOT

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