Tropical Storm Fay

NHC more bullish this AM - Crude up over $118 early NY time after London open had kicked off a small rally. Fay has a chance of making its way to the Gulf but reports are inconclusive currently. Traders are looking mostly to cover and remain neutral to long coming into this weekend. The bank long weekend in the UK may give more incentive for traders to go out long. In this case, short players can pick up long call spreads. Long players may be able to collect good premium for the 128 calls and perhaps add puts as a collar. The September Asian zero cost collar is now 110 put versus 128 call.

NY, 0850