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The Sliding Door Syndrome - Hertz

 Open the door and guess what might happen? Who knows which way the winds will be blowing. The used auto car market got dumped on last week in the U.S, especially on tariffs new.  Trump said he might raise the tariffs on cars to more than 25%. It's a fickled  market. Here are a few of the sell offs. 1) Carvana Company. It sold off over $21.00 dollars on the day last Friday. They have a reputation for having share manipulations with a long history of  insider "buying-and selling-activities". They have a short interest of 5.3% . It didn't help much that the DJIA was down over 700 points on Friday. 2} Carmax also sold off on the week. They have an earnings report coming out and that could cause the stock to drop but maybe not. It could actually rally. Here is it's one week chart and a conference call dial in number. Listen to it if you like. I might be. Now here is a look at the 65 series of Calls on this stock that expire this coming Friday.  On Friday morning at ...
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"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. Secondly, whether you like it or not this is the new reality of option trading. Illogical, bizarre trading you might say? Maybe, maybe not. It's action like this so many traders are successfully chasing. ** Here now is how these Calls options closed on the next day a Thursday leaving them with only trading day to go. Guess how much they are trading at?
Now here is the lastest action ging into a Friday morning. Look at the volume of Calls traded in this one series. It is a series $1.10 cents "out-of-the-money".
Telsa was uo today. Will the rally carry over into tomorrow's action? Let's wait and see.

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