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A Jumpy Week For Caterpillar - A Week With Earning Reports

Here is Thursday's trading on the day on Caterpillar. Here is how the $417.50 calls that expire tomorrow closed the day. Something happened this week. Caterpillar had a quarterly earning report come out on Tuesday. It's stock trading action survived this news unscathed. Here is it's five day chart as of the end of Thursday. Maybe the 420.00 or the 422.50 series Calls are better to look at? Here they are. But wait. Deere got clobbered today on the release of a quarterly earning's report. Why didn't Caterpillar sell off in price in sympathy? It shoud have. Deere sold off $34.70. For this reason alone I would be more inclined to purshase the Puts. Here is the series I would consider. To be continued.
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Apple Again... A Strong Option Trading Stock Some Players Exclusively Play

Trading Apple Calls and Puts can be a full time, do nothing else adventure. Massive volumes trade on these options. Large swings follow the "at money" Call and Put options which means that if this stock is trading at 133.50, the minute to minute action will be the options with the 133.00 and 134.00 striking prices. It's Friday morning thirty minutes into the day. Apple closed the previous day at 133.41. The 134 Apple Puts which expire today closed the previous day at .90. So what happened next?
Apple came off in price on the opening which was a continuation of it's previous day's trend. Then, about ten minutes into the market the opening strenght of the market became apparent, a 200 point opening rally. Look at the value of the 134 Puts. They dropped to a low of .61 as Apple started to rebound slightly. Then another reversal as Apple decided to move down again. The Puts jumped back up again to over 1.00. To recap, a two hundred point rise in the D.J.I. on the opening "lifted the boat" so to speak on a series of Puts that started the day following the downward momentum of it's previous day's trading. A fifteen minute trade on the opening presented itself. That's what trading Apple options is all about. As the trading continued later that morning the logic of what transpired in this short period of time was quickly forgotten. My point is that it's this first half hour of option trading on every Friday morning which is the climax of option trading for the entire week. My June 4th blog, "Working the Markets on a Friday Morning..." shares this same sentiment. A 10:45 update. Look at how the logic of the first part of this blog gets totally obliterated as the trading day continues.
In only a matter of minutes the bid .89 ask .94 we saw at 10:03 a.m. shrank down to bid .45 ask .48. That's one of the reasons I was happy to get out of my position in this yesterday. Now here is how this option series finished out the day. They closed at .78.
**** A look at Apple one day later on June 28th. It's a new ball game! At the same time the markets are tanking!

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