CAT Puts

The markets are rough in recent days. Boeing just had earning reports come out. Here is what happened in the first hour of trading. It doesn't matter what the numbers are. What matters is how the company addresses the issues. How does a company lick it's wounds after news like this. Well they artfully plants forward looking statements. Seven little very polished points which help to wash away the past and make us look forward. Well done. That's why their C.E.O.s get paid big bucks. Here is a look at one series of Boeing Call options two weeks out. The 155 series of Calls which expire on May 13th 2022. Is two weeks enough time to wash this bad news away? That's the bet. Notice this is a series which previously never had any "open interest" in them. This is rare but not necessarily a bad thing. Do you have $420.00 U.S. you want play with? It's a chunk of cash. Yes or no? Is this the right time to "pull the trigger"? It's the catching a fallin...

As I write this blog I think about the Oct 20th blog posted called "X-mas Came Early To Ford Call Holders". When strange trading days happen they stick in your mind. Another blog I wrote on March 11th 2021 talked about Boeing going up $35.00 in one week. That was also a strange occurance. Today's trading was one of those days. Why, well one of the biggest one day drops so far this year happened. The DJI dropped 981 points dragging down most stocks including Caterpillar. Today was a Friday. At 9:38 a.m. this morning here is what the markets were doing. No one at this point in the days trading was thinking that the markets might sell off almost one thousand points on the day. Here is a five day chart on Caterpillar as of 1:30 p.m. on Friday afternoon. Here finally is how the stock Caterpillar traded on the entire day. Look at how there was an additional ten dollar drop in the stocks price in the last 2.5 hours of trading. That's when the markets really started to tur...

Let's start with a question. There is one day to go and Deere today on a Thursday dropped over $13.00 dollars on the day. Should you jump into one day Call options on it right now looking for a rebound or wait until the following morning? Moving forward, in the Friday morning's premarkets at 8:30 a.m. we can see that the stock is up $1.50. Here is proof of yesterdays downward action. The premarkets are expecting to open higher. Are you to late to the party if you buy in (one day, last day) Call options that is? After dropping that much yesterday it should rebound right? Right? Let's stop. As the writer of this blog I think the real question should be who really wants to be speculating in situations like this? It's so dangerous. Learning to pick the battles you want to fight should be a very big part of this exercise. Yes I sometimes like to play Deer Call or Put options with only one day to go in their trading life but not after a day when it drops $13.00. To me tha...

Ten days ago I talked about playing Options on "Deer and Company" with one day to go. Today is a Monday I am going to talk about Deere again and show it's one day chart. Look at Deere go up just after opening. Could you have played the Calls or Puts and made some money? Well only if you where playing the upside in the first thirty minutes of trading. Trading Call or Put options on Deer with four days life left in them is a tough to do. You can get caught off side all to easily. Let me now show you (this now being a Tuesday) the prices of the May 24th Deere Calls and Puts followed by it's three month chart. These are Call and Put options that expire one month out. The action in how they change in value is trend line related. In the last thirty days Deere is up about $30.00 dollars. Many traders feel safer making bets on thirty day moving averages than on let's say four day moving averages. Catch a changing trend correctly and you make out nicely. Option players...

My most recent blog on Lucid was spot on. In this market with 400 point daily rallies playing Call options on stocks in the thirty dollar price range is the name of the game. I would however be remiss if I didn't point out the action in Caterpillar yesterday. Look at it's five day chart and look at how the Call options reacted. What a nice breakout. I am not going to bore you with all the details however this is how one series of Caterpillar Calls traded on the day. Look at the low of.06 and look at the high $4.00. I have followed stock options for over forty years. This type of action on Caterpillar on a Friday might happen once every five years. Going back two or three years ago when Telsa was enjoying a growth spurt, Friday Call option trading on that stock made many option traders rich. Bear market option trades, something not really currently on our radar can also be super rewarding. People forget that stocks like Deere and Company can also sometimes drop thirty dollars i...

In recent months Lucid has being down however on days when it goes up it does so nicely. Look at the high volume on this stock today, a Wednesday with the markets to be closed this Friday. Now look at what the markets did today and look at what the Call options did today. Look at how the stock broke out to the upside just after 11:00 a.m. You could see that coming. Look at the open interest and look at the volume of trading in these slightly "out-of-the-money" options. It's about ten times higher than the volume of trading on the options with a striking price of only fifty cents lower. Do you understand why? Professional traders do. What an opportunity to crank out big wins. Not everyday is like this. Lucid has suddenly become a "GO TO" stock to use on days when are markets are hot. Now a look at what happened the next day on April 14th. This will be the last trading day of the week as tomorrow is Good Friday. Both of these two series of Call options popped up...

On April 7th and 8th.Trading options on Deere on a Friday which expire that day hoping to catch a directional move is tricky business for a variety of reasons. In the very first hour of trading on both of these days the "bids and asks" are often to far apart to even attempt to buy into. There are times however with two days to go until expiracy when it gets a touch easlier to play. Look at what happened for example during the trading session on Thursday April 7th. Let's start with a five day chart. Do you see the dip and rebound on the morning April 7th? A full recovery from a morning like that doesn't happen very often. What's next? Well here is a closer look at it's one day chart on a Thursday as of 12:22 p.m.. The screen shows a low on the day of $5.37 on the 400 series of Calls and then a rebound to a bid/ask of $10:70 - $13:65. Also notice the super low number of Call options traded. What a rebound! All of this happened before noon. It was playable on i...