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A Real Look At Ford On The Opening Yesterday.

The stock opened down and jumped at 9:31 a.m. Look at this chart. In our last blog I followed the trading pattern of it's Calls all day. Had you placed a premarket, "at-market" ticket on the 12 series of Calls your guarented fill on the opening would have reflected the drop in the stocks price in the first few seconds of the opening. Somewhere between 9:30:00 a.m. and 9:30:59 a.m. the 12 series of Calls dropped in price to $.57. Then in the first five minutes of trading they rebounded to a high on the day of $.76. "At-market", "premarket" tickets in this instance would have guaranteed that you would be part of this action. The flip side of this logic is that there were no guarentees that the stock was going to go up. The use of "at-market" tickets on stocks in this price range with four days of trading life left in them should be included in your bag of tricks. Scarier is the use of this type of order on "last-day-to-expiring" opti...
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Harley-Davidson

First, I am not a big fan of playing options on stocks in the thirty and forty dollar range. It's not like speculating in Boeing or Caterpillar Calls and Puts with these stocks swinging up or down two or three dollars nearly everyday. Harley Davidson is a thirty five dollar stock. Look at how it is trading so poorly on the good earnings news back at the end of April.
Now here is some of this news.
All the good news was wiped out by the forecasting of a bit of a slowdown in the second half of this year. Investors who bought in early this year when the stock was trading over fifteen dollars higher who correctly anticipcated this surge of earnings must now feel so frustrated. Where are their rewards? Now look below and see where the January 37 Calls are trading at. If the stock gets above forty you would be in luck. That would buy you their next two earnings reports. By then management might see their business in a more favourable light. Yet the chart looks ugly and there doesn't seem to be a support level.* With most option positions "time value" works against you. When you purchase eight months of time and your reasonings for buying in turn out to be correct the time value can become your friend. It is however still a scary position to be considering.

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