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Bad News On Caterpillar Going Into a Friday.

Here is how the stock traded on a Thursday.There was nothing unusual about the day. I am suprised they would dump this news on the market going into a Friday trading session. It messes up option traders. Doing this type of an announcement on a Tuesday prior to the markets opening would be a less disruptive day to do this. Here is the news. In a way this wasn't totally unexpected news. As they said, there were several other recent updates on this issue. Auto companies in their recent quarterly reports were harping on this issue. Look at how it dropped in price in the after market trading. Now here is how one series of Puts closed the day. Look at how this news totally caught the markets by suprise. The secrecy of this news is a credit to Caterpillar. If Caterpillar had this news are Deere Call holders going to get worried? Here is what happened on Friday morning. Now Deere which is now also trying to shake off this bad news. These two stocks tend to trade in similiar ways. He...
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The Richness Of Tesla Options

If you are already a repeated player of Tesla options this blog will have little value to you. I ask, what level of option trading are you at? Are you able to make money trading Telsa options in less than five minutes? Perhaps that needs to be rephrased. Are you able to consistently make money trading Tesla options in five minutes? Last Friday Tesla jumped $16.50 in one day. What a ride Call holders had that day. It's Thursday morning August 28th and here we are looking at Tesla options which expire the very next day. One look tell you that they are prohibitively expensive. Here are the 350 series of Calls and Puts before the opening bell.
Can you see the numbers $5.00 and $4.81. That is how much they cost and all they both offer is a ride on Tesla options for two trading sessions. Here is it's chart.
Now what? Is there an opportunity to be found here? Well a rise in price two dollars on the opening will cause the Calls to jump about 20% and a fall in price by the same amount will do the same thing. That's all that some options traders are looking for. Get in and get out and don't mess around with the vulgarities of what the markets might do.
Now this. Are you able to see on this chart the wording "Closed at 349.60". Tesla jumped on the opening and then gave back most of this gain. Look at how the 350 series of Calls and Puts reacted.
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The Puts that closed at $4.81 dropped down to $2.93 and rebounded up to $4.06. Anyone who attacked the upward jump of Tesla on the opening first few minutes of trading were rewarded within the first seven minutes of trading if they opted to get in and then out. The trick for the Put holders was not to be holding onto a 350 Put on the Wednesday night close. The trick was to buy into these Puts on Thursday morning when Tesla was experiencing a morning upward blip. Part two. A 10:49 a.m. look at what happened next.
Tesla sold off and the Puts went up higher in price. Here they are at 2:38.00 p.m..
Here now is how they closed the day.
What a ride for the Puts. In a way this is immaterial to what I was focused on in the first few minutes of opening trading. Tesla option trading offers limitless trading opportunities. Here now is it's five day chart going into Friday.
Here now are the prices on it's one day Calls and Puts going into the market's opening. Another day has started. Will it pop again on the opening? Most traders who jumped out of postions yesterday are now charged up to play these options again. This time the action is in the 345 series, not the 350 series.
Do you notice it traded the exact same way it did on Thursday morning? A pop and a selloff. Can you ever see yourself trading in action like this? On a side note, remember how the Tesla 345 Puts we were watching at 9:38 a.m. were trading $2.54. Here is how they ended up closing on Friday.
Tesla options are known to suprise.

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