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You're Not Playing Tesla, You're Playing The Markets. Get Use To It.

The markets crashes on Monday morning after a disastrous friday afternoon sell off. The D.J.I.A. was down last week 1.1% on the week, the largest weekly decline since November. My advise is to take a vacation from option trading for a week or so. Then there is Tesla. Tesla rebounded today, a Monday after dropping a chunk in the first forty five minutes of trading. But wait, at 10:30 a.m. most market observers were congratulating themselves for sitting on the sidelines. Now this, here is how the 382.50 Tesla Calls traded on the day. I will do a follow up on this blog tomorrow and show you the closing interest at the end of the day. If it is very low, which I suspect it will be, it will further illustrate my point as to how Tesla can be a good interday trading vehicle. Now this. Exxon also dropped in price at 10:30 a.m. and dropped again at the close. Look at how the 150 Calls closed on the day. Flip a coin, it could go either way. If you look at my past blogs on Exxon in the last 3...
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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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