Featured

A Continuation Of The Theme Of Playing One Day Options On Super Expensive Stocks And Tesla

Put options on Costco with two days to go in their trading life were scrutitized in my last blog. This blog on Netflix will be quick and eye opening. Here is it's chart yesterday which was a Friday. At 9:31 a.m. Costco was trading at $1,265 up from the Thursday close of $1,257. That's an $8.00 jump. Now look at these two printouts. The "out-of-the-money" Puts! Any ticket purchased on a "one-day" slightly "out-of-money" Put just after the opening bell on Friday paid off in spades. So few traders are catching this action. One final Friday development. Imagine owning "out-of-the-money" one day Calls on Tesla yesterday. Twelve dollar one day moves on Fridays create magic for one day option traders. Tesla option trading over the past five years has attracted the masses.
Post a Comment

Lucid Calls Can Disappoint.

So G.M. and Ford are reporting tariffs are taking a bite out out of their profits. Rivian and Lucid are sneeking up on this news. Here are their morning charts.
Options on $3.00 stocks can surprise.
Here is Lucid's five day chart. Read my blog on Lucid that is only a few days old.
I could be a day late to the party on these ones. I should have thought about this casual relationship sooner. Tariffs will hurt G.M. and Ford but not Lucid and Rivian as much. Here now is how the same Call options closed the day.
What's nice about playing options on anything related to the auto section is that things happen for reasons that are somewhat explainable. Then there is Rivian.
It had the same morning chart formation. Things kind of chilled in the late morning.
It's Call options were up nicely on the day.
Once again, G.M. was down $4.32 on the day.
Now Lucid on Wednesday morning. Another jump up.
Lucid stayed kind of flat.
To be continued. Now Wednesday. It was a bad day for Telsa with an earning's report. The Lucid story of not getting hit by tariffs like other automoble makers is all but now forgotten. Short term options on $3.00 stocks can be difficult to play.
In the big picture options on two and three dollar stocks can disappoint.

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

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