I’ve used night bars to project a 127.16 target that is slightly lower than the one given here earlier. I’m recommending aggressive bottom-fishing if and when TLT very closely approaches our number, but the opportunity will depend on whether March T-Bond futures ease slightly as morning approaches. They are currently trading ^08 (eight ticks, or 1/4 of a point) above the previous settlement, and that’s probably strength enough to prevent the small decline in TLT needed to get us filled. In any case, I’ll recommend bidding for eight Feb 27 128 calls if TLT gets within 0.04 of the target. My ballpark estimate of a fair price for the calls would be around 0.84, and you can put a bid there before the opening bell that is contingent on TLT trading 127.13 or higher. If the order goes unfilled, adjust it ‘manually’ by observing the change in bid/asked as TLT falls toward the target. You can bid more aggressively if you are among those subscribers who cashed out of a winning put position on Friday for $1230, give or take a little.
