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Caterpillar - Catching A Reversal On A Monday

Mondays are not the best of days to look for reversals however Caterpillar jumped upwards a modest amount which impacted the value of this series of Puts. This is a 1:36 p.m. readout. Here is it's five day chart. Now its one day chart. It would seem like kind of a random thing to do and why fight a strong stock? One reason is that the markets are only mildly up and could give back some of it's gains before the end of the day. Caterpillar could be gaining strenght based on all of last weeks business articles talking about how Caterpillar could potentially gain from this new AI movement. Caterpillar afterall builds heavy equipment which can be used in the construction of nuclear reactors. Notice that the five day chart is in an uptrend and notice the small open interest numbers in the Puts. That's understandable. No one wants to hold Puts on Caterpillar when it is in this uptrend. Could it have a soft selloff in the next two hours? Here it is now 50 minutes later. The...
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Boeing Calls on a Monday Morning And The DJIA Down 500 Points

Let's start with a few premarket opening numbers.
Not a happy opening. How do you tackle the week in option trading when it starts like this? Do you jump into Calls hoping for a rebound or do you stay away? Let's see the volume of trading on some of our favourite picks in the first five minutes or so of market trading. Note fifteen minutes into the trading day the DJIA is down about 500 points.
What is there to learn from this? Well don't expect a noon reversal. There might be buying opprtunities after three in the afternoon so sit tight and do nothing. Here are a few closing prices. Will the markets rebound and is this a welcoming buying opportunity for option players? No one knows and snap rebounds often accompany these major sell offs. Any kind of bounce on the opening tomorrow may be short lived. Here are the closing numbers.
Tomorrow we will look at "the open interest numbers" to try and see how positions increased as or if, computereized trading kicked in. Boeing seemed to sell off the least today making it look more interesting than others. Boeing has many daily news reports.

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