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Could These G.M. Puts Go up 50% This Week?

Fighting strong stocks is a tough game especially with the indexes seemingly so strong. The Nasdaq Composite ended the holiday week at 23,366 - up 5.8% over four days. The DJIA turned up last week after a four-week slide. Now this. G.M. only reports it's production numbers on a quarterly basis and it's next report is not due out until 2026. I also know that about six weeks ago G.M. popped on an earnings report. So why will this week's stock performance be anything different for G.M. than last week? I don't have an exact reason however I just want you to hone in on this series of Puts which expire in two weeks. The open interest in this series of Puts is next to nothing. Two weeks away is a long time in the option market. I feel that G.M. is overextended as it seems to sell off near the close everyday. Yet then again, what do I know? Attempting to pick the tops of these swings is most often a losing proposition. Monday and a suprise. An afternoon readout. $1.20 to $...
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Could These G.M. Puts Go up 50% This Week?

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Fighting strong stocks is a tough game especially with the indexes seemingly so strong. The Nasdaq Composite ended the holiday week at 23,366 - up 5.8% over four days. The DJIA turned up last week after a four-week slide. Now this. G.M. only reports it's production numbers on a quarterly basis and it's next report is not due out until 2026. I also know that about six weeks ago G.M. popped on an earnings report. So why will this week's stock performance be anything different for G.M. than last week? I don't have an exact reason however I just want you to hone in on this series of Puts which expire in two weeks. The open interest in this series of Puts is next to nothing. Two weeks away is a long time in the option market. I feel that G.M. is overextended as it seems to sell off near the close everyday. Yet then again, what do I know? Attempting to pick the tops of these swings is most often a losing proposition. Monday and a suprise. An afternoon readout. $1.20 to $...
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Deere Had Earnings and Caterpillar Took No Notice

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Deere had earnings which as usual were open to interpretation. Here is how it traded on the week. It's difficult to know who to believe. Was Caterpillar affected by any of this news? Not really. It was up $25.33 on the week. One of it's divisions is starting to attract more attention. Options in both of these companies are thinly traded. I have talked about this before. Deere was down on the week and Caterpillar was up on the week. One of the problems with trying to play options on both of these stocks is that they can move up or down like $5.00 on any given day on no news. Buying on the dips if you look at the Caterpillar chart seems to be a way to profit on it's options. On Deere it was to buy Puts before it's quarterly earnings report came out. So where does that put us now? Looking at Deere Calls is one suggestion thinking it's oversold. Deere was down $22.75 on the week. Yet wait, look at the volume of trading in these two longer term Deere Call options. M...
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Carvana Starts The Week With An Opening Rally

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Let's start with the action on Carvana back at the start of the week. Here is it's mid afternoon chart on Monday. The stock is up $23.00 on the day! When I see stocks move up like this I sometimes wonder why there isn't more profit taking at the end of the trading sessions. . Now let's jump forward to Wednesday afternoon with tomorrow being a holiday. Carvana is up. How much? Well about $28.00 more dollars in two days! The word on the street is that their main competitor "Carmax" is in trouble. Here it how it has traded in the last thirty days. It had a bit of a dip but seems to be coming back. Avis Budget Group, also shown below the same thing. Hertz in the last three months has also struggled in price. So back now to Carvana. It's on fire this week. Buying Puts now that expire on Friday would be kind of dumb. The markets will be closed on Thursday. That plus the market will be closing at 1:00 p.m. on Friday. Yet then again the stock could drop $25.0...
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How Option Makers "Close The Door" On Afternoon Last Day Option Trading"

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This is something which affects retail option traders which I have never really paid much attention to before. Option makers steer option traders away from chasing the option market between 1:00 p.m. to 3:00 p.m. on "last-day-Friday-afternoon-options". It's particularly noticable on certain stocks like Exxon. I came apon this after writing a blog about trading friday morning one day Call options on Exxon. Look at the "bid-and-ask" on this series of Calls on Exxon at 1:11.p.m. Look at how wide the spread is. Sixty one cents! That's crazy wide and if your stuck in a postion that you want to get out of at a fair price well good luck. Placing in a sell ticket by spliting the difference between the bid and ask would probably cause the bid to drop. This would force you to lower your asking price once again. In other words the liquidity is not there. This is in spite of it's mornings option trading being brisk. In all fairness there may be other reasons for t...
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Catching The Smallest of Moves. Exxon On A Friday Morning.

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Exxon on Friday morning. It's five day and one day charts. .............. ..... No real volume in the Calls. Now this. Volume is coming in. It would be nicer to see the spread shrink a little bit. At this price the option makers are putting on a brave face to cover up the low of $.44 which just happened. Let's see if a rebound happens in ten minutes. Not really but the rate of declining seems to be slowing down. If you check the Puts you can see the downward action is stabilizing. In a way this is a good indication that now is a good time to jump into the Calls. Now watch this. Now this. Now this 5 minutes later. At 10:24 a.m. it's chart looks healthy. Now at 10:30 a.m. Now at 10:54.a.m. We caught the morning rebound without to much worry. That was the game plan. Getting out would make sense no matter what we leave on the table. *** Now this nine minutes later. These options just lost most of their gains! Sometimes it's good to be nimble! Now this at 1...
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