CME Forecast + Trading Strategies


Bullish Case: CME's implied volatility is lower than market's, reflecting stronger fundamentals. Increased cryptocurrency offerings and high FX trading volumes bolster growth prospects.


Bearish Case: Flat term structure and ongoing competition present downside risks. Market volatility and regulatory scrutiny may negatively impact performance.


Potential Outcomes: 55% chance of increased FX and crypto product demand driving profits. 30% chance of competitive pressures eroding market share. 15% chance of regulatory impact curbing growth.


Trading Oracle: Adopt a bullish short-volatility strategy: Sell $195.0 puts and buy $190.0 puts expiring in 16 days. This trade leverages CME's mean-reverting price action and favorable volatility conditions for positive edge and high reward:risk ratio. Monitor regulatory impacts for adjustments.


July 05, 2024










Correlated Assets

Assets that tend to move strongly with CME



LI Forecast + Options Trading Strategies   LI  Li Auto (0.32)


XLE Forecast + Options Trading Strategies   XLE  Energy Select Sector SPDR (-0.03)


VFC Forecast + Options Trading Strategies   VFC  VF (-0.04)


ETRN Forecast + Options Trading Strategies   ETRN  Equitrans Midstream (-0.22)



Uncorrelated Assets

Assets with little price relationship to CME



XLE Forecast + Options Trading Strategies   XLE  Energy Select Sector SPDR (-0.03)


VFC Forecast + Options Trading Strategies   VFC  VF (-0.04)


ETRN Forecast + Options Trading Strategies   ETRN  Equitrans Midstream (-0.22)


LI Forecast + Options Trading Strategies   LI  Li Auto (0.32)



Anticorrelated Assets

Assets that tend to move strongly against CME



LI Forecast + Options Trading Strategies   LI  Li Auto (0.32)


XLE Forecast + Options Trading Strategies   XLE  Energy Select Sector SPDR (-0.03)


VFC Forecast + Options Trading Strategies   VFC  VF (-0.04)


ETRN Forecast + Options Trading Strategies   ETRN  Equitrans Midstream (-0.22)





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