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Costco. It's Short Term Options

 Options on stocks in the $1,000  range often move  50%  or more in only a matter of  minutes on the opening on Wednesday and Thursday's . The trick is to  anticipate correctly which way the markets are going to move. That's a fools game you might say? Yes and no. It may not be a game you ever play but it might be something to consider to put in your bag of tricks when you are on a role. One thousand dollar stocks sometimes move five, ten or fifteen dollars on the day. If you have profits it's best to take them quickly. Costco is a prime example of that. Let's look at this mornings action. First it's five day and one day charts. Tuesday's trading was kind of choppy. Might it drop on the opening tomorrow? Here is a look at where the 1,035 series of Puts closed that expire this Friday. They closed at $8.50. It looks like Costco cycled up about five times yesterday. Given a weak market opening doesn't it stand to reason a three or four or five dollar will be i...
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Options On Stocks In The Four and Five Dollar Range Can Be Dangerous

Summer holidays are now over for most people and many of us are now back online figuring out how we survived the summer. Look at these charts. It's Lucid, an electric car making company and it's stock is now near the five dollar price range. Options on stocks in this price range are difficult to play. I made that comment in a posting last week on the stock A.M.C. Entertainment and watched it bounce on a Monday morning to then only give up it's gain. Why not just buy the stock if you like? That makes more sense. That is one of the reasons that the volume in these Calls is so light. Now look at Lucid's one month, five day and three year charts.
Now against this backdrop consider this. "In-the-money" Call options with one month to go. What one would be hoping for is some kind of a good news annoucement.
The early October time period is afterall is not that far away.
These $.60 cent Calls (or $6.00 dollar a contract) could go to $1.20 (or $12.00 a contract) on any kind of a pop. Here they are again on the opening on September 4th.
Notice the "ask" has jumped up to a crazy number. When you buy options on thinly traded series you almost have to buy in on days it is trading down. Lets also now look at the 3.5 series of Calls that expire in three days.
This seems to now be where the action is with a much more realistic bid and ask.
To be continued. A September 4th update (Wednesday at the close) Faraday Future update. I have talked about this stock before.Look at how it's $5.00 Calls that expire this Friday traded. Up 1,900 % on the day. They closed Tuesday the day before at .04 cents.
Sometimes five dollar options will suprise. A September 11th update.

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