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Can You Play The Dips On $10.00 Drone Stocks With One Week to Go?

First off why would you want to? It's a Monday morning. As we get closer to the two final days of trading in the "one-week" options on the following three stocks the liquidity issue will make them somewhat difficult to trade. Let's start by looking at these three drone stocks and looking at how their one week to expiracy options are trading. Most drone stocks don't really yet make any money but the world is waking up to understand their usefulness when it comes to military fighting. Within this industry there is a lot of competition and there are many other countries also making drones. Trumph has helped to bump up the values of many of these drones stocks especially during the first half of this year. It's all now kind of a guessing game as to who the winners and losers are going to be. In the last few days a rough patch in the trading patterns of all drone stocks is causing some alarm. 1) First a company called "Red Cat". Google it if you wish. F...
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Roku And It's 2nd Quarter Earning Report

Let's start with the time period of Thursday morning with an earning's report coming out after the closing bell. Look at how crazy expensive these three series of Call options are. They are the Roku "out-of-the-money" Call options that expire tomorrow. The volume in them is not all that crazy but if I owned the stock I would be tempted to sell the Calls against my position and hope they would expire worthless. Tomorrow is Friday August 2nd.
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Why pay so much? Why pay $4.05 for a Call with a striking price of "58" with one trading day to go in the contract? The stock would have to jump four dollars just to get your money back? Talk about stupid? Yet then again Netflix, a company also in a similiar space sometimes moves like ten dollars in one day. Here now is a look at what happened by showing tomorrow's five day chart.
Down $2.19 on the day to $53.14 with the DJIA down over 600 points.
Say goodbye to those Calls if you ever bought in. Now let's look at it's year-to-date chart.
Can you see how it dropped about $35.00 quickly on the release of it's first quarter's earnings? That's part of the reason why these Calls were so expensive. On good news it could have really popped. So what were it's second quarter earnings actually like?
It's still reporting losing money per share however their guidance is starting to look more promising. Having the markets drop over 600 points on the day (it was down even more than at one point during the day) really squashed any upside potential. The game never ends. Here now is how next weeks 53, 54 and 55 series of Calls are trading.
Pick you battle. How did things turn out four days later in a crummy market? Not good. Look at these same options. People however are now waking up to the fact that the quarterly earnings report was not all that bad. Trading options is never a walk in the park. There is still time for these Calls to suprise.
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