Featured

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 ...
Post a Comment

So What Can Happen With One Day Options (Friday Options) On The Day That The Djia Closes Up Over 400 Points?

 First, here is how the markets closed on the day last on June 27th 2025.

In recent times that is happening more often than you think. Let's look a these following five stocks

1) Walmart.


They were up 135.29%

2) Fedex.

Of coarse these ones were "out-of-the-money". Here are the "near-to-the-money"  Calls where the risk were less and the gains not as spectacular.
Still not a bad gain but a much safer trade.

3) McDonalds. This stock is beat up as of late.


A 194% gain on the day. Can you see how we are not looking at obscure stocks.

4) Carvana

These Calls were slightly "out-of-the-money" Look at the low and the high.

5) Boeing. 


Here is an extreme price increase. 10,400%. You don't see that very often.
Now here is another Boeing Call option with a lower striking price, something more conservative option players might find themselves in. The rewards were also impressive.



I could go on with countless other examples. Now look at this. A screen shot of  pharmaceutical stocks I am watching on one screen.. Can you see how so many stocks traded on the same day in the red?

One day Call options on any of these stocks would have failed. By the same token look at the negligible gains and small losses in all of these auto stocks on the same day.  Gains on the day like $.01, $.04, $.07 and $.17. One day Call options on stocks in this sector would not have worked. Even the darling stock Tesla failed to take off on a day the DJIA was up 431 points.

So what really is my point in writing this blog? Well anyone with a distain for looking at "one-day-until-expiring-options" should wake up to the reality that this type of trading is not about throwing darts at a wall. There is work and risk taking involved in picking the winners of the day.

Comments

Post a Comment

Popular posts from this blog

Living on Kraft Dinner?

Image
What does the word disconnect mean? As a verb it means "to sever or interrupt the connection of or between; detach". Option trading - one day options - is a disconnect from the world. What happens to slightly "out-of-the-money" Call options on Costco when the stock shoot up thirty dollars on the day? I will show you what happened on Friday to Costco Calls and the options on a few other stocks I frequently watch. What a disconnect from the real world. But before that a look at how the indexes traded. 1) Costco. It's five day chart and a look at how three of it's option series moved upwards in one day. You may not know how to read these printouts but try to read the highs and lows on these option pricings. One printout shows an "at-the-money" option which means you are buying a contract on the stock, good for one day only at a locked in price equal to (or very close to) what the stock is currently trading at. The other two contracts shown are ...
Read more

The Little Engine That Could

Image
Walmart again. It's all I seem to blog about. Here is it's five day chart. The stock keeps going up and the option series are set up in one dollar spreads. Even a fifty cent move on the stock moves the needle on these Calls. Look at how this series of Calls was trading yesterday at 3:00 p.m.. Now here is this same series of Calls just before noon today. Thirty days of upward action like this punctuated by the off day of decline. Now notice the higher volume of trading in the series of Calls with the higher striking price. These are the ones's with more leverage. At the same time look at the five day chart on Costco. The two stocks sometimes trade in tandem. Humpty dumpty sat on a wall .... a had a great fall. Someday soon a fall might happen but what a great ride it has been.
Read more

Another Blog On "Vinfast"

Image
There is so much to read about this companies history online. Do your own homework. Their success is not dependent on what ends up happening with their sales in North America. They are nimble. There are plenty of auto factories all over the world now for sale they can acquire. They have dabbled in Australia. Having access to money to keep going doesn't seem to be their problem. Rivian also seems to enjoy this advantage. Vinfast is currently building a new plant in India which could employ thousands of people. That's an emerging new market. New relationships are being built and new investors will be coming onboard. Are option players looking at this stock? Not really if we look at these "one-month-out" Calls. What about Calls further out? What about next January? Here is a look at the three and four series of Calls. Nobody seems willing to bet Vinfast Calls. Now this. Here are two snippets taken from a blog I wrote about this stock back in early December of 2024. ...
Read more