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Caterpillar - Catching A Reversal On A Monday

Mondays are not the best of days to look for reversals however Caterpillar jumped upwards a modest amount which impacted the value of this series of Puts. The Puts are off about 50% on the day at this point in time. This is a 1:36 p.m.readout. Here is it's five day chart. Now its one day chart. It's Puts. Why consider them? It would seem like kind of a random thing to do. Why fight a strong stock? One reason is that the markets are only mildly up and could give back some of it's gains before the end of the day. Caterpillar could be gaining strenght based on all of last weeks business articles talking about how Caterpillar could potentially benefit from all this new AI movement. Caterpillar afterall builds heavy equipment which can be used in the construction of nuclear reactors. Notice that the five day chart is in an uptrend and notice the small open interest numbers in the Puts. That's understandable. No one wants to hold Puts on Caterpillar when it is in this...
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Deere And Something Crazy

The stock Deere is extremely volatile and options on it with one day to go are, for lack of better words, explosive. Explosive beyond belief. Small retail investors are advised to stay away. They are very thinly traded. Just stay away! Now here is how it traded this morning, Friday July 28th.
So at this point in time just before 1:00 p.m. it is down $.17 cents on the day. If you owed the stock and were just checking it to see it's current value it would make you just yawn. When I look at it it makes me want to scream in disbelief! At 11:57 p.m. here is what the $375.00 Puts which are $.17 cents "out-of-the-money" Puts are trading at. Do they offer good value? Maybe. Yet that's not my point. Focus instead at how low they these contracts traded at prior in the day. Can you see that they traded down to $.08 cents when the stock was trading well over 380! Image catching this action and predicting the downside around 10:45 a.m. Deere can move five dollars in one day and that is what it decided to do this time.
Now have a look at the current bid and ask. Bid $.58 or fifty eight dollars per contract and ask $1.14 or one hundred and fourteen dollars per contract. Have you ever witnessed a spread that wide apart? Crazy. Now this. Deere has 275,570,300 shares outstanding. Why are there not thousands of shareholders watching these options looking to catch these magnified option price swings? Why has the propostion of trading contracts like this become so foreign? Am I wasting my energies following stuff like this? I don't think so. Now this, a different visual look at how these Puts are trading at 1:51 p.m. only seven minutes later with the stock now down another eleven cents. Can you see how sensitive these price movements are. It's amazing.
Now this. It's 2:06 p.m.,some ten minutes later. There was one more contract sold. The price it sold for this time was $1.10.
When fund managements companies boast of 15% annual return rates I have to ask myself this question. Why can't they invest monies in programed option trading to catch short term price movements like this as short as this. It seems kind of silly to be doing anything else but this. Now more of the same action eight minutes later.
What ended up happening to these Puts at 3:00 p.m. in the afternoon? That's the deadline when retail traders have to sell out. Here is it's chart.
Now this.
At around 3:00 p.m. these Puts hit a high of $4.58 . Not a shabby return for those traders bold enough to consider the "out-of-money" Puts on a Friday morning.

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