CAT Puts

Here are two series of it's option that expire tomorrow. At 11:23 a.m. the Puts finally broke. Previous blogs talk about how Boeing has been so strong. Fighting strong stocks is a battle so the interest in them is not all that great. Here is how it closed the day. Few traders caught this downside action. Fighting strong stocks is a dangerous game. If you get the direction wrong with options that expire the very next day you are finished.

Here they are. What I want to show you is the open interest at 10:29 a.m. and the open interest as 10:31 a.m. I have talked about this before, computer generated traded kicking in at 30 minute intervals. Now this. Nothing happened. In option trading there is always a bias to the upside. What this tells me is that fot the next ten minutes of so I don't see Boeing surging upwards. Here is it's morning chart at 10:43.a.m., thirteen minutes later. Now the Puts. Now the Put action at 11:20 a.m. with the D.J.I.A up 460 points. One option at this point in time is to give up and sell out and get your money back. Most traders don't think that "one-week-options" offer this versatility. They do. Getting back your money playing Puts on a morning the D.J.I.A is up 460 points is a win in itself. Just get out and look at this situation on a day the indexes are not so strong. Here is how Boeing closed the day. This trading activity never ends.

What a chart. A safer bet would be these "near-the-money" Puts. But wait. Only 32 contracts traded. It's wednesday and that's the day of the week big on option reversals for "one-week-options". In a world of computer generated trades why aren't more option contracts popping up on our screen? Boeing has 182,000 thousand employees each with their own special insights as to how their company is doing. We just reported a share price oncrease of 8% in one day. It doesn't get any better than this to speculate that Boeing could give up some of this gain. Let's think bigger. Boeing might go up another ten dollars in the next two days and fifty dollars in the next thirty days. It has the power to do that. But what happens if all of Trumph's this week peace rhetoric goes up in smoke? This is not a bet on Boeing. It's a bet on Trumph. In option trading you sometimes have to make trades that are not comfortable and even if you lose you know it'...

It's Tuesday morning and Boeing jumped up $17.30 on the previous day. That's a jump in the stocks price of 8%. Here is it's one day chart. There was news. It helped that the markets in general had a good day. Will the stock jump again on the opening? In premarket trading it's slightly up. Can you catch the downside action with Puts on the opening? Should you? Is fighting a strong stock a stupid thing to do? Here we are three minutes into the trading action. The stock is only up a touch yet these two series of Puts are down, one series 37% and the second series 41% and the trading day is just opening. Both are super leveraged trading vehicles. But wait. The bad news is that the markets are surging up. Caterpillar is on fire. Is hanging around with Boeing Puts a smart idea in times like this? Not really. Just get out. Get out. Forget this ever happened. Who cares if these Puts go even higher. A ten minute trade lets you get on with the day. Caterpillar also offered...

It's Friday July 31st. Look at this stocks one and five day charts and then look at how one series on Puts which expire today struck gold. First it's one and five day chart. ... I don't know much about this stock however this blog follows the last blog on the topic of buying Puts on spiking stocks. Look at how this one series of Puts below has reacted on this one day selloff. Had I picked a series of Puts further "out-of-the-money" the gains would be even more remarkable. Look at the low of the day which happened on the morning spike and look at where the option is at now! Yet wait the game is not as easy as it looks. How often does a stock drop that much in one day? Not very often. Look at how Apple dropped like 30 points after an earning's release and this series of "out-of-the-money" Puts merely doubled. It could be argued that risk involved in making the trade outweighed any potential reward. If we now go back to our friend, the stock name...