|This Trade Was Closed July 18, 2012|
I let this run for a bit, but despite my concerns about uncertainty there really doesn’t seem to be much movement right now. I can close this for a small profit plus costs.
Original Trade Post:
For a while I thought the Bank of Japan might intervene more heavily and try to drive the yen down while they had some momentum to do so. However, I think the window of opportunity has passed and if anything gets sketchy tonight with the Chinese economic announcements and such we are likely to see a good pop in the value of the yen.
I am trading the calls on FXY rather than a spot trade because I suspect that volatility could be pretty high tonight while the news is digested.
I suppose the biggest risk I am taking here is a WFC/JPM announcement that is just amazing. Although I am not expecting that to happen, if it did I would not be surprised to see the FXY drop as investors get out of safe-haven investments before the weekend.
This is a short term trade that I analyzed just before the market close, but I think it will be interesting. If we catch some bad news tonight and a bad report from JPM I think we could see prices trend higher on FXY (and lower on the SP 500) very quickly.
- The Ticker: FXY
- Target Price: 1.25 per share
- The Trade
- Buy to Open Aug 2012 125 Calls at .75 or better
- Trade Opened: July 12, 2012
- Trade Closed: July 18, 2012
Chart courtesy Finviz. Click to open larger.
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