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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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Charts Don't Usually Do This So Quickly. FedEx

Look at this chart - it was early into a Friday morning. I am sorry I ignored it.
It was Fed Ex and I was too busy to be watching it. My first thought when I saw the drop was that here is a perfect example of how a stock can drop and then be held perfectly still at a lower level. I often see this kind of a chart formation and know that it is often a precursor to further price declines. Yet I overlooked something. It's Fed Ex and this stock has a history of over amplify bad news and then somehow discounting that news.
......
The chart above shows its one year trading history. It's a power house business which has a history of getting knocked down. Now this.
Can you see how some traders were not afraid to buy in on bad news? In this case there was time after it crashed to get in on the buy side. Now a look at next weeks Calls to see the slightly different trading action.
NOW LOOK AT THIS. THIS IS SOMETHING SUPER IMPORTANT. Look at the open interest now in these next week Call option. OPTION TRADERS ARE SMART. THEY KNOW HOW TO PLAY THE GAME. Pick your battle and run. There are now only eight open contracts on this series of Calls! Yes eight. The consensus now is that this particular option series is now to risky to hold onto. (I will check back in a few days to show yu how they are doing). The end.

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