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Google Calls

This isn't a heading that will grab your attention. There is always news on Google doing something. This blog is about reacting to a chart formation and is in line with my recent focus on discussing the often dreaded topic of "one-day-options". Look at how Google bounced on Thursday morning. Something caused the stock to spike the first thing in the morning. I don't know what it was. Here was two of it's news updates. Here is how this series of Calls closed the day on Thursday.They closed at $2.00 and are $.20 cents "out-of-the-money".div class="separator" style="clear: both;"> Let's move forward. Now here is how Google is trading at 9:33: a.m. It's up. Now this, a suprise at 9:38 a.m. Look at how quickly these Calls lost half their value. What is the DJIA doing? Not much. Now this, six minutes later. Look at how quickly the action in the Call options increased. By 10:00 a.m. they reached a high of three dollars. ...
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The Classic Caterpillar Chart Formation

Here is a stock chart to celebrate. It's the "Caterpillar-jumps-ups-up-in-price-chart-formation". Celebrations like this do usually not last all that long. Today the markets charged up as Trump talked about Toyota investing an absurd amount of money on investing in the U.S.A. One number bantered around was $650 billion. If that was to happen, wouldn't Caterpillar benefit from all of this action. They would afterall be commissioned to supply some of the heavy equipment suddenly needed to build all these new factories. Trump also cut the tariff's on Japan's imports down to the 20% level. Yet all of these numbers could change. Here now are three short term series of Call options to look at. All have jumped up in price in one day.
Most option players would be super elated with short term gain like this. Here now are options with same selling price on the same stock, but this time one week further out.
What do you notice that's different about these ones? You do notice they cost more? Yes because you are purchasing extra time. Let's do it again. This time with options even one more week further out.
What usually happens to stocks that spike like this? Here now is it's next day action.
This type of a chart is difficult to play. Now how does it's year to date chart look?
Things will get more interesting around August 5th before the opening. That's when their next quarterly report gets released.***Is Toyota really on the hook to spend that much money? Not really. Trump is just throwing money numbers out of a hat. Here is how Caterpillar and the Calls we were watching closed the week.

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