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Deere Had Earnings and Caterpillar Took No Notice

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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A Follow Up To A Recent Blog I Did About Playing Two Week Options

Let's begin by saying I am not a big fan of buying "two-week-out" options. Yes they cost a touch more than "one-week-out" options however that is not the reason why. I like thirty day out options and one year out options and Monday, Wednesday and Friday "one- day-options" better. So what's the matter with "two-week-out" options? Here is my answer. Back on January 6th we looked at the Interactive Brokers Group 180 series of Calls that expire on January 17th. At that time they were trading at $4.90 a contract. Here is a look at that printout I posted.
Now this, a Friday January 10th printout. The DJIA closed down over six hundred points on the day.
So here we are at the end of the week and we have for lack of a better word, wasted four days or almost half the life of these options. But wait. Can you see how they where down 47.66% on the day? That means on the previous closing session they were trading at $6.25 per contract. (It's a brokerage company so it's obvious it's going to drop on a day the market has a big sell off). Now a look at it's five day chart.
Imagine buying Puts on it on the morning rally on Tuesday morning and getting out at a huge profit minutes later at about 10:30 a.m. If you follow the charts wouldn't you recognize that could happen? If you answer yes then why do you need to clutter up your mind with "two-week-out" options. I say this because I feel more secure playing five, three or one day options than I do playing "two-week-out-options". Yet that's only me. ** Yes there was a decent profit to be had on the "two-week-out" options preceding Fridays precipice slide but that's another part on the "two-week-out" option holding syndrome. The urgency to take profits isn't there compared to playing shorter term options. ** How did these 185 Calls end up trading on January 17th?
Bottom line. The options on this stock are more interesting than most.

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