Showing posts from May, 2021


What To Focus On - Part Two

My blog of November 27th was entitled "What to Focus On". Please read it. This week we are feeling a bit of a hangover. Last's weeks triple witching event is over. Stocks that were forced to contract in price to sqeeze out spectatate positions on them are now free to resume there old trading patterns. This Monday morning at 10:20 a.m. the Djia is up 301 points. There are also losers. So now what? Mark on your calendar exactly three months down the road how the markets traded on the first morning after one of these triple witching events and use this same logic to catch the upside on the next "hangeover" day like this. How do you pick the winners? Find a few stocks that have enjoyed a recent upswing and play them to pop on the first trading session after one of these events. This blog is just an observation.

"Boeing" Jumping Ten Dollars In One Day and How I Ended Up Picking Up The Crumbs

On Thursday June 27th 2021 "Boeing" jumped up in the morning like ten dollars a share and went on to close out the trading session on a strong note. It's not that unusual to see airline stocks jump like this, or "Telsa" or many other stocks priced over $200.00. Stocks like "McDonalds" and "Disney" which cost less by comparison often go up by half of this amount. It's often near impossible to seach out as to why moves like this happen. In this instance, one of the reasons could have being because a Judge imposed a less severe than expected fine on "Boeing" for past issues and another reason was the release of rehashed news about new plane orders. Often times the real issue is trying to determine how fresh all of this news really is. If your an option player what then do you do when you see price swings like this? Jump in on the upside and hope that this upside wave continues, stay away from it altogether or try to play the downs

"Caterpillar Calls" and a Thursday Morning Bounce"

Does playing "Caterpillar" options on Tuesdays ,Wednesdays and Thursdays give you enough time to make money? It can be a little bit scary because your fighting the issue of time values eating away at the cost of your options and you have to get the direction of which way you think the stock is going to go lined up properly. Buying in late in the day looking for morning bounces is one way to play it. I prefer Thursday and Friday plays on "Caterpillar". This week on Tuesday I purchased both the 237.50 series of Calls on "Caterpillar' and the 240 series of Calls. On Wednesday I was down 30% on my investment from the previous days purchases and on Thurday morning there was a bounce on the opening. I got out. This little prinout says sell one contract, the 237.50 contract at $5.27 at 9:40.a.m. On the buy side I bought in on Tuesday at 3:47 p.m. and paid $2.22. Here is the ticket and here is another chart showing the bounce. ( My 240 Calls did equally as well,

"Ford" and an Extreme Opportunity Missed

If you were out cruising in your Mustang convertable on Friday you probably missed this action. It's a shame because had you purchased $1,000 of a certain "Ford" series of "Call" options on the opening and sold out just after lunch you would have made enough money to turn your ride into something a lot nicer, something like $47,000 nicer. Honestly, this did happen and it wasn't all that complicated trade. This blog from this point on is going to write itself. Try and follow this action. Look at the high and low on these options. .01 and .47 . One thousand dollars actually turned into $47,000 if you caught it right. I have talked about how options on stocks in the ten and fifteen dollar range can often be darlings to play and "Ford" and "U.S." Steel are two of these darlings with options series that are the most splendid to play because their liquidity is excellent, bid and ask prices tight and price movements swings on only five and te

Buying Caterpillar - A "Catching a Falling Knife Trade".

In with two "Calls" at $1.59 each which expire the next day. The stock is down ten dollars in three days on no real news. This kind of judgement calls is sometimes difficult to make. The stock seems to dropping on light volume which is better than on heavy volume. It's a "no news scenario". Let's see what happens next. A 10:30 a.m. update, one hour after I got in. I am down something like 37%. At this point in time it has turned into a "sit-and-wait" hold. What I like better is an"in-and-out" in thirty minute trade. Now another look at it at 11:30 a.m. with the D.J.I. now up over 225 points. Remember I got in at $1.59 a contract. I don't enjoy these having to wait until Friday morning situations. There was a bounce on Friday morning and I got out. It's difficult to read but it says two contracts sold at $3.60 each at 9:49.a.m. Here is it's morning chart. Would I make this kind of trade again? I am attracted to these &

Caterpillar "Calls" and an Introduction To Pre Market Trading.

What an exhausting week for seasoned option traders. It's not over yet. Here is a trade I entered into today Thursday at 3:59:32 p.m. Here now is it's five day chart. I could have purchased "Mcdonald's" instead, it's about the same price. Let's see what happens tomorrow. On a differing note, "Elon" can't be to happy these days with the way his stock is performing. Part two of this blog. It's an introduction to pre market option trading, something I seldom talk about. When you google "when is the best time to trade options" what comes up? When I did it and here is what I found. Pre-market trading can be very deceiving and should only be reserved for seasoned experienced traders. The most viable types of stock worth trading pre-markets are gapper/dumper stocks, usually during earning season. When I read this type of stuff I get a little bit upset. How are option traders to learn anything from this kind of Mumbo Jumbo? If you co

Tuesday May 11th. A 473 Point Drop In The D.J.l. In One Day With "Mcdonald's" Options Up and Down

I went into Tuesday with a "McDonalds" "Put" which I sold at 10:04 a.m. I had bought it just before close on the previous day because I liked the chart. First here is it's five day chart followed by a one day chart. The market tanked on the opening and I didn't wait long to get out At 10:00 a.m. it seemed to be on a rebound. See the chart. I got out once again at 10:04 a.m. Here is the ticket. Like they say, shoot first and ask questions later. The printout is difficult to read but it says out at $5.30 This traded netted me $150.00. I was ok with that. Everything was down but the day was early. Were the markets oversold? I turned around and played the upside. Sometimes that can be the worst strategy in the world and I did it with two trades. I liked what I was doing because I was trying to play a morning bounce after a sharp morning decline and my fills on these two trades were at 9:52 a.m and 9:55 a.m.. I got out ten or fifteen minutes later at 10:09

Power Surges in Option Trading

If your an "Uber" driver working in the downtown core of major cities you know about power surges. If a subway breaks down and the system is broken hundreds of people suddenly need rides. At the very same time the rates you charge will spike up. That's the best time for "Uber" drivers to be out driving. Well playing options on stocks with a day or two to go until they are about to expire is kind of the same thing. Friday May 7th was one of those days. If we look at "Boeing" and "Caterpillar" we will see two examples of what I am talking about. First "Boeing" and it's one day chart and a look at it's 230 "Call" options and it's 232.50 Call" options. What specifically we are looking at is the highs and lows on the trading price of the option series. In the first case there are two sets of numbers. A low of .51 and a high of 6.90 and a low of .16 and a high of 3.40 That's the price swings of the options