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Tesla On A Friday Morning.

The concept of playing last day until expiring Tesla options scares most people. Maybe it shouldn't. In the list of the five most actively options on any company Tesla would come it at about #2.. My next statement is going to sound kind strange. One strategy often employed is to look for quick reversals on the opening on Friday mornings with the soon to be expiring options (at 3:00 p.m.) and see how this situation plays out. That's what has happened in the first chart below. It sounds silly yet watch them for yourself for the next month or so and see how often this pattern happens. Now here is it's chart at 9:56 a.m. this morning. It's flat after a dip on the opening.That flat line on the top of the chart shows you wher it strted the day. The dip on the opening dropped these Calls down to $.85 cents. Now here is it's five day chart. You can see this morning's dip in it's chart. Now to further set the stage here is how it's Calls and Puts are tradng, a...
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Toyota

Very few option contracts trade on Toyota. I have wondered why and offer one potential explanation. It's listed on multiple exchanges around the world and "option makers" in North America are basically just following the action. If the markets open stronger in North America that means Toyota traded stronger overnight on markets overseas. Secondly, the Calls and Puts trade in incriments of five dollars.There are for example 135 Calls, 140 Calls, 145 Calls. Having a five dollar spread wipes out the incentive try to daytrade option series which are soon to expire. If the stock moves from 142 to 143 the "bids and asks" on a 140 series of Calls might hardly change. It's not like trading the stock like Boeing where you can get in and out with option series set up in increments of $2.50 . Here is it's one month charts. The company now has a new C.E.O who is getting criticized for not moving to go electric quickly enough.
What I am now about to show you might discredit some of my above points. It's a five day chart on Toyota and look how all the action seems to happen on the opening. Why? It's the effect of overnight trading on other markets. Our North American trading follows Toyota's overseas market trading.
Now back to my point of how contracts trade. A volume of three and twelve contracts in the 140 Calls and Puts series that expire soon. Look at how wide apart the "bids and asks" are and how low the outstanding number of open contracts are. It's crazy.
Toyota is a great company. It's just not one that attracts option players.

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