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Caterpillar - Catching A Reversal On A Tuesday

Tuesdays are not the best of days to look for reversals however Caterpillar jumped a modest amount which impacted the value of this series of Puts. This is a 1:36 p.m. readout. Here is it's five day chart. Now its one day chart. It would seem like kind of a random thing to do and why fight a strong stock? One reason is that the markets are only mildly up and could give back some of it's gains before the end of the day. Caterpillar could be gaining strenght based on last weeks articles talking about how Caterpillar could potential gain from this new AI movement. Notice that the five day chart is in an uptrend and notice the small open interest numbers in the Puts. No one wants to hold Puts on Caterpillar when it is in this uptrend. Could it has a soft selloff in the next two hours? Here it is now 50 minutes later. The "bid and ask" are almost unchanged. There is also not much change in the DJIA index.Now this. The DJIA is sellig off and Caterpillar is hanging ...
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Carvana Again. The Crooked Stock.

 Donald Trumph talked tough on tariffs this week. All cars are expected to cost more. Car makers will take a hit and used car retailers will be able to squeeze out higher prices. So it goes in theory. That plus the DJIA had a good week.  Here is how the Call options on Carvana traded on Friday. If you read my recent past blogs you will see the same chart performances where Carvana jumps up.. Here is it's five day chart. Look at how the Call options preformed on Friday. The stock was up $12.78. The one day calls options (the last day to expiry Calls shown below} did wonderfully well. Look at the high and low numbers on it.


Look again at it's five year chart.
Jump in, jump out. If you look at a few of my recent blogs you will see how often it jumps up and down. If you hit one of these moves it will make your week. It's jumps up and down are not really related to any news. Costco is another stock with wild option swings. Trading Costco options is different. Professional writers can sound intelligent in describing the various factors that can cause this stock to go up or down. Tariffs, and the such. There always a new slant to why it is trading like it is. A slant that everyone buys into. Here is a five day chart on Costco. Can you count the number of times it swings six or seven dollars in one day? It's bids and asks are tight. Yet it's a dangerous game. It's also the kind of stock you have to have the guts to buy into after it switches direction and then ride the wave in whatever direction it seems to want to go.
It looks like everyday has major swings. So why are these options so difficult to trade short term? Well look at this chart. It's constantly shifting in direction.

 How do Caterpillar and Deere stack up in this option playing game? Well they can be trickier with more institutional ownership of these stocks. Why does this make a difference? It's a private men's club mentality. These two stocks seem to trade on news that only an exclusive group are privy to. Groups that follow the advise of well paid analyst. Here is how the stock Caterpillar traded on the week. Deere is particularly hard to trade with fewer options contracts traded and less chatter.


In my June 13th blog I looked at the Boeing stock after the crash. I said stay away from the one and two week out Call options after the crash. Now it bounced.
What was one of the most surprising stocks on the week?  Avis Budget. Here is it thirty day and five day charts.



What a run it has had.
What stock wasn't so pretty? The Harley Davidson stock "Live Wire". It had a recent big jump on no news. Here is it's chart.

Charts like this scare me. Finally Polestar. Here is it's news and five day chart further on below.




Look up Geely. They are not going to go away and they keep on giving them money. That plus Polestar recently announced sales are way up and their relationship with Volvo is changing. Learn about it  yourself.  Lucid and Rivian are two other stocks which have backers with deep pockets. That lessens the worry about going bankrupt. That's being a concern as of late for Polestar.




All I am saying is that Polestar is starting to look more attractive. I also know that one dollar stocks are not everyone's cup of tea.
What a strong week on the markets. 

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