Entry Alert re: Mini-Sized Dow Jones (YM, CBOT)

By: Patrice Johnson | Sun, Jan 17, 2010
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1/17/2010 3:52:22 PM

Welcome to The J.E.D.I. Way.

The J.E.D.I. Way will be buying the following call option on the MINI-SIZED DOW JONES (YM, CBOT) at the Market:

(1) 1 - Mini-Sized Dow Jones MARCH 2010 10,900 Call Option (Ticker Symbol: YMH111450C)

The J.E.D.I. Way will also be buying the following put option on the MINI-SIZED DOW JONES (YM, CBOT) at the Market:

(1) 1 - Mini-Sized Dow Jones MARCH 2010 9000 Put Option (Ticker Symbol: YMH19000P)

Below is The J.E.D.I. Way's "SET-UP CRITERIA" and "ENTRY-ALERT" for the above listed options on the April 2010, June 2010, and August 2010 Nymex Gold:

SETUP: PRICES MOVING OUTSIDE OF A PRICE CHANNEL

Buy Call Options on the March 2010 Mini-Sized Dow Jones (YM, CBOT) when the following conditions have been satisified:

(1) The 50 Day Moving Average is trading above its 200 Day Moving Average on the WEEKLY CHARTS for the Dow Jones Industrial Average contracts.

(2) Prices on the Dow Jones Industrial Average trades above both their 50-Day Moving Average and their 200 Day Moving Average.

(3) Prices on the Dow Jones Industrial Average close above its short-term resistance line at 10,525 and thus outside of its price channel and trades above the price level of 10,525 for at least 3 consecutive days thereafter.

CHART 1:

CHART 2:

ESTIMATED COST:

($270.00) - $85 FOR BUYING THE CALL OPTION; $165 FOR BUYING THE PUT OPTION; $20 IN COMMISSIONS

ESTIMATED BREAKEVEN (w/$20.00 commissions per round turn):

$105.00 (or 21) for the March 2010 Mini-Sized Dow Jones Call Option

$185 (or 41) for the March 2010 Mini-Sized Dow Jones Put Option

ESTIMATED UPSIDE TARGET FOR 2010 MINI-SIZED DOW JONES FUTURES: $11,450
ESTIMATED DOWNSIDE TARGET FOR 2010 MINI-SIZED DOW JONES FUTURES: $8000
MAX GAIN FOR DOING THESE TRADES: Unlimited
MAX LOSS FOR DOING THESE TRADES: $290.00

PROTECTIVE STOPS FOR THE CALL OPTIONS:

None for the March 2010 Mini-Sized Dow Jones 11,450 Call

PROTECTIVE STOPS FOR THE PUT OPTIONS:

None for the March 2010 Mini-Sized Dow Jones 9,000 Put

EXITS:

The J.E.D.I. Way will exit the March 2010 Mini-Dow Jones 11,450 call at breakeven or better, otherwise take a loss of $105.00 for this options contract.

The J.E.D.I. Way will exit the March 2010 Mini-Dow Jones 9,000 put at breakeven or better, othewise take a loss of $185.00 for this options contract.

EXPIRATIONS:

The March 2010 Options expire on March 19, 2010.

CONTRACT SPECIFICATIONS FOR MINI-SIZED DOW JONES FUTURES OPTIONS:

Price Value of Option Point: $5

CONTRACT SPECIFICATIONS FOR MINI-SIZED DOW JONES (YM, CBOT) FUTURES:
Contract Specifications:YM,CBOT

Trading Unit: ($5.00) times the Dow Jones Industrial AverageSM Index.
Tick Size: One point ($5.00 per contract)
Quoted Units: DJIA index points
Initial Margin: $3,503 Maint Margin: $2,802
Contract Months: Mar, Jun, Sep, Dec
First Notice Day: Not applicable (cash settled contract)
Last Trading Day: The trading day preceding the third Friday of the contract month.
Trading Hours: 5:00 p.m. to 4:30 p.m. Central Time, Sunday - Friday.
Trading in expiring contracts ceases at 3:15 p.m. Central Time on the last trading day
Daily Limit: Successive 10%, 20%, and 30% limits.

Until next time...

Thanks for listening, and good luck with your trading.

E-mail : Patrice@stockbarometer.com if you have any questions about this trade or any other questions or comments. If you are interested in continuing to receive our advice following your trial, please click the following link to subscribe. http://www.stockbarometer.com/pagesJEDI/learnmore.aspx If you are receiving these alerts on a trial, you have access to all of our previous articles and recommendations by clicking here: http://www.stockbarometer.com/articles.aspx?subscriptionid=20 If you do not recall your username and/or password, please email us at customersupport@stockbarometer.com.

Best Regards,

 


 

Patrice Johnson

Author: Patrice Johnson

Patrice V. Johnson
The J.E.D.I Way

Patrice V. Johnson

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