CAT Puts

This is one of a series of blogs about short option playing. Past blogs have shown us that Boeing sometimes jumps if it has jumped only a few days before. Here is it's five day chart as of 3:30 p.m. on Thursday followed by it's one day chart. .............. Now let us look at three series of Call options that expire tomorrow. Now the higher "out-of-the-money" $375.00 series of Calls at 3:50 p.m. Based on it's five day chart pattern it could jump on the opening. What's going to happen next?

Let's quickly get up to speed. Here is a chart on Deere at 1:08 p.m on a Thursday and a look at the $480.00 series of Calls which expire tomorrow. Note the stock at this point in time is down $35.12 on the day on a bad earnings report. Now this, a look at one series of Calls. The 480 series of Call options. They look cheap. In a recent blog (well just last week) the stock Eli Lilly was in the exact same boat. Here is it's 30 day and 5 day charts showing a rebound after a steep decline. ..................................... We are talking about Eli Lilly crashing in one day and then moving up after that like $50.00 in just five trading sessions. Isn't it true that stocks after a major fall like this tend to take a couple of days to rebound back up again if that's the direction they decide to go? Based on this occurance isn't it possible that Deere could sell off some more before the end of today's trading day? Here is a look at the 480 series of Puts that expi...

Here is how the 510 Calls and Puts are trading. The stock is currently trading at $508.84. Earnings come out before the market opens tomorrow. Now here is it's five day chart as of 2:00 p.m. Now it's thirty day chart. Not much action. Both the Call and Put options are expensive. They should be. Deere has a history of moving wildly on the release of earning reports. Here for example is how Deere traded on the day of it's first quarter earnings report earlier this year and what was said at that time. The spike in the chart is the day the earnings report was released. Now back to today's situation. Notice the 510 Calls for the day are up on the day. It looks like the street is looking for a bounce. What do the $517.50 Calls and the $520.00 Calls look like at 2:23 p.m.? Notice the volume in the Calls is the same as it is in the Puts and that fifteen days ago the stock was trading about $15.00 higher in price. This tells me that the stock will have no issue jumping back...

Mondays chart. There doesn't seem to be much to get excited about. Here are how two series of it's Calls were trading towards the end of the day. Now let's skip ahead to Tuesday morning and look at it's chart. It spiked. I talked about it's spikes last week. Here now are the same two series of Calls we just looked at. Let's skip ahead to 11:29 a.m. The stock is up even more and so are it's Call options. With Boeing spikes do not last forever. Is it time to consider the Puts? The 230 Put series would be more enticing than the 225 Puts. Here are the 230 Puts. These are the ones closer to being "in-the-money". Here are the 225 Puts. Now can you see this little dip and how the 230 Puts increased in price 48 minutes later ? Boeing spikes are something to consider playing in the type of markets we have had in the last week. *** How did the stock and it's options end up closing the day? I showed you both a Call and Put trade. Here is what happ...

There was news today. Check out this action in Village Farms and others. Could this be the start of another run up in this sector the the marketplace? It's not a one day story. This is big news. Day two of this developing story. Now day three.