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Ford Calls and a Big Surprise.

Look at this Ford chart on July 1st. Now todays Call options. Every quarter these types of reports come out. This one was good. Watch for it Next July 1st. A $2.00 option went up to close at $37.00. In my introductory remarks to this blogging channel a few years ago I said many old farts driving Mustang convertables paid for them from money made on playing Ford options. This bounce today in the Call prices based on this good news report of rising sales was one of those events. Now this, the strenght continued into the following day which is Wednesday July 2nd. This is a short week for option trading with tomorrow being the last day. Action like this is extremely rare.
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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.

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