Follow Up to Trade Alert - (FXY) July 24, 2015
As a potentially profitable opportunity presents itself, John will send you an alert with specific trade information as to what should be bought, when to buy it, and at what price. This is your chance to ?look over? John Thomas? shoulder as he gives you unparalleled insight on major world financial trends BEFORE they happen.
Trade Alert - (FXY)-TAKE PROFITS
SELL the Currency Shares Japanese Yen Trust (FXY) August 21, 2015 $82-$84 in-the-money vertical bear put spread at $1.98 or best
Closing Trade
7-24-2015
expiration date: August 21, 2015
Portfolio weighting: 10%
Number of Contracts = 59
By perfectly catching the ?RISK ON? move in global markets that launched on July 9, we have managed to book a healthy 16.5% profit with our position in the Currency Shares Japanese Yen Trust (FXY) August 21, 2015 $82-$84 in-the-money vertical bear put spread in only two weeks.
I should send Trade Alerts from the back of a camel more often!
Last night, market makers marked this spread at intrinsic value, or $2.00. This means they are assigning zero value to the remaining one-month of time decay. In other words, this spread is now overvalued.
In any case, we have squeezed all the juice out of this orange, and there is nothing left to be had. The risk/reward is now unfavorable for keeping this position.
If you can get done anywhere in the $1.98 region, as many followers have already done this week, go ahead. $1.97 or $1.96 would be fine.
If you bought the (YCS) instead, sell it for the short term, but hold it for the long term. You have captured a nice 6 points on this trade.
I have not suddenly fallen in love with the beleaguered Japanese currency. I am merely moving to the sidelines, keeping my powder dry, so I can leap on the next chance to sell higher up.
We are well into a long term relationship with the yen?.on the short side. The long-term structural strength of the US dollar has years to run. The yen is gunning Y130 by year end, and eventually Y180 or Y200.
Good job traders, and on to the next opportunity!
Don?t execute the legs individually or you will end up losing much of your profit. Spread pricing can be very volatile on expiration months farther out.
Here are the specific trades you need to liquidate this position:
Sell 59 August, 2015 (FXY) $84 puts at?????$5.50
Buy to cover short 59 August, 2015 (FXY) $82 puts at..?.$3.52
Net Proceeds:??????????????????.....$1.98
Profit: $1.98 - $1.70 = $0.28
(59 X 100 X $0.28 ) = $1,652 or 1.65% profit for the notional $100,000 portfolio.
