Double Crossover Method (Golden Cross)

The golden cross occurs when the shorter term moving average rises and crosses above the longer term moving average. One of the most common golden crosses used is the 20-period and 50-period moving average crossover. A golden cross is often associated with sharp upward price movement and can be used as a buy signal in the belief that a significant uptrend will follow. The position is maintained until the shorter term moving average crosses below the longer term moving average.

ADAPTED OPTION STRATEGY: LONG SYNTHETIC FUTURES

When you are bullish on the market, the long synthetic futures strategy is ideal as it will not be affected by changes in volatility. Profit increases as the market rises. Profit is based strictly on the difference between the exit price and the synthetic entry price. Selling a Put effectively removes the risk of time decay for the long call position.

LONG SYNTHETIC FUTURES: Leg 1

Trading Symbol OZS H7
Option Type CALL
Option Strategy BUY
Strike 1040
Expiration March 2017

LONG SYNTHETIC FUTURES: Leg 2

Trading Symbol OZS H7
Option Type PUT
Option Strategy SELL
Strike 1020
Expiration March 2017

ADAPTIVE FUTURES STRATEGY

Trading Symbol ZS H7
Strategy LONG
Entry Point 1033.00
Target 1050.00
Stop Loss 1026.00
Contract Expiry March 2017

DOUBLE CROSSOVER METHOD (GOLDEN CROSS): ZS H7 FEBRUARY 2ND

ACTUAL OUTCOME

POTENTIAL GAIN PER CONTRACT

As a trend following strategy, substantial upside can be expected. The strategy’s initial target should be set near the next resistance level (1050 - end of January’s overlap) but the position can remain opened until the shorter term moving average crosses below the longer term moving average (1053).

POTENTIAL DOWNSIDE PER CONTRACT

If the price falls below the first significant support level set at 1026, the position can be closed at a limited loss.

Double Crossover Method (Golden Cross) happening right now in the market

Crude Light: CL

Palladium: PA


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