Showing posts from July, 2023


Deere On Earnings

Here is a look at Deere towards the end of the afternoon after an earnings report. It got beat up pretty bad. What we are now looking at is a printout of one option series which will be expiring the next day were trading towards the end of the trading session. Would now be a good time to buy into these 395 Calls and try to play tomorrow's upside? Lets look at how these options traded the next day. Can you see they hit a high of $4.65 sometime during the following day? I did two very small trades on the Friday morning bounce back. I just wanted to cover my commissions a make a touch. Remember Deere options are extremely difficult to play and with only hours to go before they expire its not bad to take a profit whenever you see one. .................. My times in were 10:14 to 10:31 a.m. and 10:59 to 11.09 a.m. I missed the elusive high of $4.65 which happened after I got out. Part Two. Going forward. Let's look at Deere's five day chart and look at how the 400 series o

An Example of Call Options on Caterpillar Prior to an Earnings Release

Not all retail option traders are up to the challenge. What am I talking about? Caterpillar Calls just before an earnings release.This is a blogging site about Caterpillar Calls and Caterpillar Puts. The stock could have a huge jump if the earnings beat expectations or investors could be worried a recession looms. Look at both Caterpillars thirty day and five day charts. Now look at what the 262.50 Calls are priced at which expire at the end of the week (August 4th). Very few option traders are playing them. Normal in my opinion should be over 1,000 contracts in a series like this trading everyday and a few thousand open interest contracts. With global warming more heavy equipment will always be needed to rebuild our roads and bridges getting washed away by floods. That plus Caterpillar recently come to terms on their contract talks and supply chain issues are getting better. Did you see how Boeing jumped in price on it's earning report a few days back? Caterpillar could jump t

Last Day Options Can Suprise. First Solar

Look at this chart (July 28th ). It's the early morning action on First Solar after an earning report. Now look at this chart. It's a five day chart of the same thing. The earnings were good but the stock spiked up and came down again. What was the news to cause it to drop? I looked around and couldn't find anything and the D.J.I. was have a good day. What to do? One day Call options are so dangerous and I was completely out of the loop as to why the stock was trading this way. Why the downward pressure? Here is what I did. In and out in less that ten minutes for a $90.00 gain. Had I waited until noon and sold out then I would have lost over half my money. Now here is how it closed out the day. Now a look at it's one day chart. Why am I showing this? Well look at where the stock was trading at noon. The rules say that if your trading a last day option you have until 3:00 p.m. to get out and not 4:p.m.when the market closes. Who wants to fork out money to try and

Tesla In the First 10 and 30 Minutes of Trading on a Friday Morning and Then The Close.

First read the "Gamma Bog" recently posted which talked about Telsa Calls. These options traded the same way a few years ago when Telsa was enjoying a previous growth spurt.Telsa opened just a touch down while the market opened up. It's Friday morning and there are options on it that expire today. Other big name companies also opened with no direction. Now look at Tesla and a little bounce. First, here we are two minutes into the trading action and the action at 9:32:53 a.m.. Now a 10:13 a.m. The stock continues to crawl upwards however the time factor could start to work against it if the market starts to sell off. Some traders would take their profits and close up shop for the week. Look at the change. Now lets check in at 3:11 p.m. to see how the days action played itself out. Telsa is on a terrror. This kind of action has being happening for months. *** In at 11:00 a.m. and out an hour or so later after buying and selling ealier in the morning. Sounds impossible

"Out-of-the-Money Calls" (With Two Days To Go) on Tesla

What are the odds on a Wednesday morning of Telsa sitting at $275.00 jumping to $300.00 by Friday of this week? One or two percent at best? I am just picking that number out of a hat. So here is the thing. Short term "out-of-the-money" Calls can be amazing trading vehicles. If you new to the option market for the first time it should not be something that you should be thinking of doing. First todays five day chart on Telsa. The stock enjoyed a modest opening bounce. Well actually it was one of the best bonces it had in five days. Now look at how the "out-of-the-money" 300 Calls bounced. Crazy and off-the-wall you might say? In my July 10th blog entitled "A Gamma Squeeze" I provided a statistic which says that Telsa and Apple combined make up 42% of the option trading volume set to expire on any given Friday. (This may not always be the case however it currently is). This tells us two things. First the liquidity is there to make these kinds of trades.

Rebalancing Indexes

This is an interesting read.

A Gamma Sqeeze.

Here is somthing diferent. In China things are different. New start-up companies with rising output numbers will always attract an inordinate amount of attention. Other EV companies like Polestar and Fisker might start to gain attention. Both are down from the start of the year. Finally, we just read that Telsa and Apple each have 42% of the option market trading. Interesting times.

A "Cat" Suprise On A Friday And A Mention of "Rivian" The Most Actively Traded Stock By Share Volume On The Week On The Nasdaq

It happened. A friday rally on the stock Caterpillar. See the chart. So 15 minutes into the trading session and Caterpillar is up just over 1 dollar. Look at the spread on the bid and ask on these slighty "out-of-the money Calls". If you want to buy them just below the asking price the bid and ask will usually be bumped up. If your waiting for a fill and you are somewhere with a bid between the bid and ask waiting for a fill which doesn't seem to be happening you can cancel your order and then resubmit in to see if that works. It might.In these early moments of market trading on a Friday morning no one really knows what to expect. These are once again Call options that expire at the end of the trading session. Well it's actually 3:00 p.m. when you have to close out your positions. That a special rule they impose on options that expire on that day. Now shown is how these same Calls closed out the day. Can you see how high these Calls jumped at one point in the day? N