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TFC Commodity Trading Forum

Re: Corn...the final solution hahaha/Gian

If you look at most any chart that starts trading in a tight channel that is what's called a 'range of indecision". It has always tended to result in an "explosion" out of that tight range. You don't really have to pick direction using technicals,fundamentals or anything else. Simply buying an "Option Strangle" on that market which is often very cheap will catch the move regardless of the huge gaps where most wont get filled and many more will get killed being on the wrong side of the move out. The longer the time spent in the channel the cheaper the OTM options are as a rule. You've mentioned Bollinger Bands before and said you use them. You must have read about trading what they call the "SQUEEZE" which is where the bands tighten to extremes relative to what it has been doing. That is much the same thing as well. Like all option positions you still need to have lots of time on your side but it is a good way to trade a potential explosive tight pattern. Doesn't matter a damn where it explodes to whether up or down as long as it goes somewhere strongly. And tight pattern breakouts tend to do exactly that. Only way to lose is for nothing much to happen. Doesn't take much of a move to double or triple your money on the 'entire' option Strangle either. You can cash out early on the 1st move and often the side that is now worth next to nothing often comes back and also makes you money on the rebound.