Senior Contributor
Posts: 1,634
Registered: ‎05-03-2010

OptionEye....Mar 27th

USDA Eve..


Markets trading nervously ahead of the figures tomorrow.


One large trade yesterday in corn really stood out and I think it sums up how the market has been feeling. There has been some good selling of the Dec 5.00 straddle by institutional players over the last few months...They have the view that we are going to ultimately drift towards that strike and they will benefit from the delta, vega and theta reaping big benefits.


Well, looks as though they had second thoughts and covered a large part of the short straddle position yesterday and look to do more today. That tells me they are happy with their short term profit and it is not worth the risk of running it into the report on Thursday. They expectations are for a lot of acres so I think they are worried that the possibility for less acres is greater than more and took a large chunk of the trade off aggressively yesterday.


As for outside markets they are as crazy as ever. Almost a record high close in the S & P yesterday...still confounds. Today equities are lower. Gold is a little lower as well. Oil is .50 cents lower and the Euro is still weak.


We hear more about home sales today with GDP tomorrow.


Happy hunting.

Posts: 749
Registered: ‎11-09-2010

Re: OptionEye....Mar 27th

Yeah!  I think you may be right that Phi Theta inverse to Pi can kill a trade. John