The gap through the 149.23 target implies that DIA is a strong bet at this point to achieve the 155.30 target of the ‘extension’ pattern at the right-most edge of the chart (A=137.60 on 2/25; B=148.66 on 4/11; and C=144.24 on 4/22). I’ll suggest staking out a speculative short if and when DIA gets there by buying four out-of-the-money puts with a June expiration. I’ll provide further details if and when the target is closely approached, but at the moment, my Tradestation option grid is kaput. Traders should position from the long side between here and around 153.50. _______ UPDATE (May 22, 11:48 a.m. EDT): The futures vaulted to an intraday high at 155.14 before selling off sharply. Accordingly, I am going to track four June 152 puts @ 1.00. For now, tie them to a stop-loss at 0.88 against an order to sell two @ 1.14.
