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Will The Markets Top Out?

The Nasdaq Composite index closed up 4.7% on the week. the S&P 500 index, was up 3.6% and the D.J.I.A.was up 3%. Given the elevated volatility levels options have become extremely expensive to buy. Here for example is how Avis Budget traded on Friday. At one point in the day the 300 series of Calls traded as high as $15.43 on the day. The stock never traded much ovee the $302.00 range. What an exorbitant premium forming part of this equation. ........ Now look at the prices on this week's upcoming Calls and Puts. ... What happened to the old days of paying $5.00 or $6.00 for one week out options on stocks in this price range? Look at how Caterpillar jumped on the week on no real news? Up like $83.00 from it's low of the week back on a Monday. Here now is what a one week out just slightly "out-of-the-money" 790 series of Puts is trading at. That's not as bad as the premiums on Avis Budget but look at Caterpillar's thirty day chart. Actually the stoc...
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Options on Five Dollar Stocks Can Surprise! HSAI

I have talked about this stock before (Hesai Group) and this morning it suprised again. Back on May 17th I did a blog on it called "A New Company To Learn About". Now lets look at it's current five day chart leading up to this morning.
Look at yesterdays volume pour into it. Now this mornings early action. Another spike in volume on the opening.
What's all the excitement about this morning?
If you don't know this company here is what they do.
Now back to my May 17th blog. Where were the five series of Calls on it trading back then which expire in January 2025? Here is how this same series of Calls is trading now.
No one had any interest in them. The bid and ask where crazy far apart. The option makers were burdened by making option markets for a stock with not much of an option trading history. The worry aferall is that a stock like this could double or tank overnight on news. Any stock could but more often it happens in this price range. Why would I say this? Well stocks in the $5.00 range are not penny stocks and are not likely to drop to zero overnight. With good news and a story that is for real they can sometimes pleasantly suprise. Here they are now.
So what happened today on November 27Th. Here now is its current five day chart and todays action in the 5 series of Call options on them that expire on Dec24, 2024.
Thursday was Thanksgiving and the markets were closed. This particular series of Calls still have a month to go. Trading volumes on Friday, the day after are usually expected to be somewhat subdued. Here is what happened to HSAI
This kind of upward action can't last forever. Options on stocks in the 5 dollar range can suprise.

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