Featured

Late To The Party Option Players - Disney

Can late to the party option traders make money? It's something to consider? These Call options expire this Friday. There was news on it before the opening today. The second chart below a few minutes later shows it hanging tough. At 10:01 a.m. we now checking out the Puts. The bid and ask on the Puts are very tight. That also makes us ask what happened to the Disney 101 Calls that we first looked at? Here is what the chart now looks like. More Call option players have jumped in to play the upside that the downside. Might one do a spread and try to play it both ways hoping for a breakout either way? That's an option to consider. Disney has being a dog of a stock now for a year so might some profit taking set in? How is Disney going to pay for another theme park? With that on their plates forget any share buy back programs. They are taking on new risks in a period of global uncertainity. Are late to the party option traders best just to stay away from this unexpected situ...

Caterpillar Calls And A Friday Morning Bounce.

The markets were spooked on the opening and here is what Caterpillar did in the first twenty-one minutes of trading.
Now here is how the 260 series of Calls reacted.
Notice there was next to no "open interest" in them going into this mornings opening and very little early market trading. A reading of next to no "open interest" is a rare phenomenon. Also notice how this series of options traded down to $.75 (seventy-five dollars) a contract. Would a look at Caterpillars five day chart give us any indication that the stock could break out of it's downward trend? Yes, it suggests that anything could happen.
Now a lunch hour update. Caterpillar exploded to the upside! A bid of $5.95 and an ask of $6.60.!
Two conclusions. Avoid purchasing Calls on Caterpillar at the close on a Thursday (Calls that is that expire the next day). If you like the upside wait and hope for Friday morning early dip. Here we have a prime example of how Caterpillar can bounce. Also, don't let a low "open indicator" number bother you. It amazes me that so few traders recognize the opportunities found with trading "last day" options on Caterpillar. Now a final look at how Caterpillar and the 260 Calls ended up closing the day.
Ninety-three contracts traded on this option series on the day and most of that action happened in the first twenty minutes of trading. Instititions and brokerage houses missed the boat on this opportunity! Wall Street is dumb sometimes. * 3th quarter earnings are due out Oct. 26th. Floods, fires and wars. The world is changing. More Caterpillar products are needed to deal with the effects of global warming. Here are past earning numbers.
But wait. The game of betting on earning reports to be higher than what analyst predict is not one most people want to play. That plus recession worries overshadow the markets. Deere and other companies have had strong past quarters only to witness stock price declines. These are tough times to be in the market when money in the bank can earn 5%. Caterpillar Calls are not on the minds of very many investors.

Comments

Popular posts from this blog

Living on Kraft Dinner?

The Little Engine That Could

A Fireside Chat - One Year Options and Thirty Day Options. Which is Better?