Featured

Get Ready For A Slug Of New Earning Reports

The stock Ford reports 7/30/2025 (Post-Market). In a July 2nd blog I did Ford talked about their June sales. Here is something I posted in that blog. Ford jumped $.50 cents on news of an increase in sales and this is how this one series of Calls (which were "out-of-the-money" with one day to go) jumped. This upward moment in price was like an once in a 100 day occurance. So will earning's be good this quarter? Has Ford's recent good news story now lost it's importance. It's only natural to be forward thinking. General Motors has earning report coming out before the market opens this Tuesday. The two stocks sometimes reflect the same market momentim. G.M. seems to have a lot of inventory sitting on dealer lots and popular You Tube scream that the car industry is now about to crash. Here is how things for G.M. are lined up to go. It's stock had the jutters all week. Investors are getting tired of hearing about consumers buying new at pre-tariff pricings...
Post a Comment

The Boeing Crash And How Option Players React

 It's  going to take time for the dust to settle on this event. 

The stock dropped on the day it happened. 
This event puts option traders in uncharted territories. Do you look at the Call options on it that expire tomorrow?  Here is how one series of Call options were trading mid afternoon.

Let's now look at how these same series of Calls closed out the day.
One question to now be asking is why try to even being playing these options. Remember just a few weeks ago when Boeing had two straight weeks of upside movement?  Why get caught up in this turmoil now?  Let's move on. Let's now also track the Calls with the same striking price one week further out.

My thoughts are it's best just to stay away. The worry of why this happened might take some time to go away. There are easier battles to play.  A Friday update. The DJAI was down.

Boeing was down .

The 205 series of Calls we were tracking that expire today expired worthless and here are next weeks 205 Calls. Large selling volumes hit this stock on the opening on both days .It didn't help that everything was down. The volume of contracts traded where quite high.
Can you see the dip and rebound. Can you match that dip to the drop on Friday's chart. Shown below is a one day chart of how Boeing traded.

Imagine buying one day Calls at 10:30 a.m. and getting out two hours later? Shown is an example of how the 195 Calls traded on the day.

Did I catch any of this? No. I was busy doing something else. Traders glued to their computer screens were watching the DJIA average sell off all day which capped everyone's enthusiasm  to make crazy one trades on the upside. Yet traders who hone in on "hour -to hour"  Friday morning one day options would have witnessed this action happening. Are next week's Boeing options still promising? Maybe however I still don't like the concept of looking for rebounds on bad news situations. There are easier games to play.




**** An update a few weeks later.

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

A Fireside Chat - One Year Options and Thirty Day Options. Which is Better?

Image
Some say to think small, not big. Trying to play Disney options is thinking big. It is a stock slightly out of favor. If we start with it's a three year chart, we will see it is down by about 50% over that period of time. Now it's one year chart. If the stock can break 110 in early 2024 the sky is the limit. It does have a lot of moving parts so anything could happen. Look at these Calls options one year out. One year in options buys a lot of time.They look reasonable. If the stock ever inched up to the $105.00 price level in the three or four months these options would jump up in price by about 50%. Even more if they had really good news. Yet it's the "what-if" aspect of the equation that castes such a trade in doubt. "What if" stories just don't cut it. There are to many variables in play. Then again, why are we even thinking of long-term Call options after a December's rally? Let's switch gears. If consumers are out spending for X-ma...
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