Crude Oil is at a major resistance. We are going to take an aggressive option trade on it. Notice, I said aggressive. We are going to do a “unbalanced butterfly” strategy for 0.10. It may not fill but that is all we are willing to risk.
In the strategy, we are going to risk $100/contract to try to make min. of $400 by option expiry in September. If we get to 250% before option expiry, we will take it off.
If you want a less risk trade, you can look at buying a put on the Oil ETF USO for $74/contract. If every dollar move, you will make or loss $23.46/contract. Based on technical analysis, we are looking for price to get to 32.18 if the resistance holds. Here is the risk graph for this trade:
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