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Costco. It's Short Term Options

 Options on stocks in the $1,000  range often move  50%  or more in only a matter of  minutes on the opening on Wednesday and Thursday's . The trick is to  anticipate correctly which way the markets are going to move. That's a fools game you might say? Yes and no. It may not be a game you ever play but it might be something to consider to put in your bag of tricks when you are on a role. One thousand dollar stocks sometimes move five, ten or fifteen dollars on the day. If you have profits it's best to take them quickly. Costco is a prime example of that. Let's look at this mornings action. First it's five day and one day charts. Tuesday's trading was kind of choppy. Might it drop on the opening tomorrow? Here is a look at where the 1,035 series of Puts closed that expire this Friday. They closed at $8.50. It looks like Costco cycled up about five times yesterday. Given a weak market opening doesn't it stand to reason a three or four or five dollar will be i...
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Playing a Bounce After a Five Hundred and Forty Three Point Selloff

Yesterday we looked at the drug stock Moderna as the stock dropped eighteen dollars and twelve cents in one day on no real news and we were following two Call option series, one being "near-the-money" and one being "out-of-money". Today the market dropped another big chunk.
Stay away correct? Well kind of. If a stock drops eighteen dollars on one day and if most stocks had large losses what might you consider at do at 3:59:52 p.m. on the day of this fall? You might consider buying "in-the-money" Calls waiting for an uptick on the opening. We talked about the 185 Calls and the 200 series of Calls. The stock closed if you remember at $186.40. Why Moderna and not look at Calls on stocks which dropped by a lessor stock amount? Well eighteen dollars is enough of a drop to attract bargain hunters. Here is what happened on the opening today and here is how the 185 Calls looked in the early morning trading. The stocked bounced to over 190.00 in the first few minutes of trading after closing at $186.00 and look at how high the Calls traded up too.
They closed at $10.00 opened at $11.00 and went as high as $13.10. That was a trade. If the market had of rebounded it would have popped up more. Look at how the stock went on the trade on the remainer of the day.
Will the 175 Calls get a slight bounce on the opening tomorrow opening? A dead cat bounce? The answer is probably no as there is not much to get excited about on the upside at this point in time. There would have to be some good news for the industry. Something to cause some confidence to start to buy in.

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