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The Sliding Door Syndrome - Hertz

 Open the door and guess what might happen? Who knows which way the winds will be blowing. The used auto car market got dumped on last week in the U.S, especially on tariffs new.  Trump said he might raise the tariffs on cars to more than 25%. It's a fickled  market. Here are a few of the sell offs. 1) Carvana Company. It sold off over $21.00 dollars on the day last Friday. They have a reputation for having share manipulations with a long history of  insider "buying-and selling-activities". They have a short interest of 5.3% . It didn't help much that the DJIA was down over 700 points on Friday. 2} Carmax also sold off on the week. They have an earnings report coming out and that could cause the stock to drop but maybe not. It could actually rally. Here is it's one week chart and a conference call dial in number. Listen to it if you like. I might be. Now here is a look at the 65 series of Calls on this stock that expire this coming Friday.  On Friday morning at ...
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Trying to Outguess The Markets

A few years back the markets crashed when Russia invaded Ukraine. The front pages of newspapers around the world at that time showed people trying to escape cities which were heavily shelled. Our heart's sank. How could such atrocities be happening? Why were schools and hospitals targeted? War is evil. Guess what? With Trump acting as a new dictator the world once again has gone awry. It's scary that one old man with so much power can abuse the system. What does all of this mean for option traders? It means time to sit it out on the sidelines. Yes you can jump in playing rebounds and catch some nice short term directional moves. You are basically trading against computers. Why not just sit it out and chill? Everything is amuck. Why be trying to make hero trades? Ironically enough some traders are being drawn into this action. Look at this chart.
While its difficult to see because of a "pop-up" on the screen "Netflix rebounded over ten dollars a share after rebounding from a previous low two days ago. Making a trade to catch the upside would have been a "hero" trade, meaning one that took guts to execute. Get in and get out and catch a ten dollar bounce based apon a techical bounce off a previous low. Cool stuff right? Not really. The markets are crashing and these are Call options that expire in one day on a stock that is a freefall. Now this, an hour or so later. A $27.00 drop has turned into a $53.00 drop.
A further drop later on in the day with the stock down $84.36.
This series of Puts shown above went up over 400%. To what was this sell off attributable to? It doesn't really matter. Here is one explanation.
My point is to let the markets reset themselves. Now this, a look at how another series of "out-of-the money" Puts, the 950 series traded on the day.
Some traders did catch the action. Small fish stay away. Happy trading days will return.

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