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A Jumpy Week For Caterpillar - A Week With Earning Reports

Here is Thursday's trading on the day on Caterpillar. Here is how the $417.50 calls that expire tomorrow closed the day. Something happened this week. Caterpillar had a quarterly earning report come out on Tuesday. It's stock trading action survived this news unscathed. Here is it's five day chart as of the end of Thursday. Maybe the 420.00 or the 422.50 series Calls are better to look at? Here they are. But wait. Deere got clobbered today on the release of a quarterly earning's report. Why didn't Caterpillar sell off in price in sympathy? It shoud have. Deere sold off $34.70. For this reason alone I would be more inclined to purshase the Puts. Here is the series I would consider. To be continued.
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Powerhouse Options - Meta Platforms and Microsoft

In a July 31st blog I talked about two powerhouse stocks, Microsoft and Meta Platforms both with exploding earning reports. That day was a Thursday. Here now are their current five day charts.
Both of these stocks sold off today which is a Tuesday. The DJIA was down 61.90 points. On Monday they exploded upwards on the day as the DJIA was up 516 points. So where does that leave us now? Well it leaves us playing the direction of the indexes using these two stocks as pawns to make it happen going into mid week with three trading days left on these two series of options. Why? Well once again these two stocks are still in the "glowing in the spotlight stage" of last week's price movements. Ten dollars up or down in a day seems to be the norm and three day options serve well as a trading vehicle. (That lenght of time is a perfect fit.). Now this. First Meta.
Excellent liquidity and huge price swings. Now Microsoft. The same thing. Huge interday price swings.
At the prices of $570.00 and $313.00 these prices are doable. Let's see what happens. Now the premarkets on Wednesday.
Both are up about $3.00 which is enough to get out in the premarkets at a modest profit. Now this on the opening. First the Meta 765 series.(I am showing the 765 series by mistake, meaning to show the 770 series on the opening). The stock is up over $6.00. The 770 series is also up.
Now this at 9:52 a.m. Meta was up however has now lost most of it's gains.
........ The $570.00 price we were watching hit $895.00. however lost it's gains by 9:52 a.m. What about Microsoft? You can see now that mid morning it is down. $4.70 was it's high on the opening..
The DJIA is down 89 points after the first hour of trading. Is there a lesson in all this? If you are playing options on two powerful stocks that had amazing earnings last week and you are trying to play one day reversals after a down day, then try and get out in the premarkets. In the Meta Platforms situation you would be selling yourself short using this strategy however with the Microsoft example you would be better off. When you see premarket profits in two out of two postions just take it and enjoy trading in the rest of the day. Do you do premarket sell tickets "at market". I am afraid to, I pick a price I like. Why am I afraid to? Well you do not get a reported fill until after the markets open and you sometimes have to wonder if there is some trickery in how it all plays itself out. Waiting for a fill when the market is moving up or down is never a fun experience. The DJIA closed up the day 81 points and here is how the Meta Calls closed.
**** A final thought on the topic of Meta and Microsoft and five and ten dollar swings in one day. When the markets drop 600 points in one day there is a heightened change of the markets slipping again 200 or 400 points on the following opening. That didn't happen this morning and the little blip in the morning was nothing more than a reward for Call option holders willing to put money on the table at a risky time.

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