Cotton Breaks Out

On Tuesday I highlighted some low IV conditions in cotton futures.

Snip from Tuesday:
Well, yesterdays bar might have the bulls sitting up and paying attention, but ostensibly sideways.

What is of interest to option traders is the multi year lows in implied volatility. In the last few days, IV mean has finally decided to collapse below 20% to basically be on a par with statistical volatility, making them look like fair value for the first time in quite some time.

I wouldn't go calling them cheap or underpriced, but buying could finally be considered in my opinion

We are now looking at a breakout of a bit of a ragged basing pattern and including Tuesdays big up day, this looks pretty bullish.

Options at fair value and at multi year IV lows looks like pretty good conditions for a straight out plonk on calls in my opinion.