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Costco Options With Two Days To Go. Something To Consider , As Strange As It Might Sound

First, Costco is down $44.79 over the last ten trading days. The company sells food and everyone needs to eat. The chart looks like it might now want to rebound. Down $44.79 It's crazy that it could sell off that much in such a relatively short period of time. What about other stocks in this price range like Netflix? Well the Netflix stock is priced at a higher level. It's at $1,257.00 and yesterday afternoon it was at $1,213.00. Yes, today it was up $31.30!. The point is high priced stocks can make big moves and that's what makes Call and Put options on stocks like this so potentially rewarding. Most people would never consider trading in Costco options. I get that. More on that later. Now back to Costco doing so poorly as of late. It's now Thursday morning before the markets are open and here is a look at it's "at-money" Calls and Puts. Notice the light volume of the "open interest'. The two numbers reported in this example are 480 and 358. Whe...
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So The Markets Are 341 Points Lower On A Tuesday At The Close. Two Different Companies In The Same Space To Look At For A Rebound.

First the markets at 3:58 p.m.
Now look at these two stocks and their five day charts.
Here one series of Xpeng's Calls at 3:57 p.m.
These are massive drops in a very short period of time. Call options premiums on downward moving charts can get very bleak to look at because the "end-of-the-tunnel" is not in sight. E.V. sales are however, strong. The second stock is our perennial favorite, Tesla and two series or it's Calls, both "out-of-the-money" just before the close on Monday.
Two things. The $7.14 reported fill in the fist fifteen minutes of trading on the 335 series of Calls was most likely was a premarket fill which would have being reported just after the opening bell. Remember it gave up most of it's premarket gains before the opening bell. Next. Are slightly "out-of-the-money" Calls good to look at with three trading sessions still to go? Well the fear factor on the second trading day of the week (Monday in this case was a holiday) is generally less that the fear factor on the first trading day of the week. They still however can drop half price in the blink of an eye. Let's see if these two stocks regain some of their composure tomorrow. If they do then these "slightly-out-of-the-money" Call options are the place to be. It's a bet on the markets opening stronger. It's not as risky a bet as a bet on the markets open stronger on a Friday morning with "last-day-to-expiring" options where you only have one chance to get the direction of the market right. Let's see what happens. (Elon Musk's wealth amounts to about 10% of what the bottom half of what the half of the U.S. population collectively owns. Bernie Sanders puts this figure as being closer to 50% ). Tesla moves quickly. Isn't it better to play stronger stocks that are moving upward after a few down days? Yes and no."Both of these stocks have performed poorly in the last five days. In five day option trading Mondays going into Tuesdays are a good time to take a risk, or in this case a Tuesday into Wednesday because Monday was a holiday. The same is not true for Tuesdays going into Wednedays on a normal trading week of five days. Now a look at the Wednesday premarkets.
Tesla is up $5.00 which means instant profits if we want to get out and Xpeng did nothing. This leads me to make the following comment. Seldom do I talk about trading short term options on $20.00 stocks. They can be great for three or five month trades but not one week out options. Yes they can sometimes suprise but overall they most often disapoint. Now the opening markets seven minutes into the trading session.
Here is a suprise. Tesla lost it's premarket shine!
The 332.50 Calls at 937.14 retained most of their value however 1.20 minutes later the stock dropped another $.15 cents and the further "out-of-the-money" Calls, the 335 Calls took a further hit. So what is the lession here? Learn to take advantage of premarket trading. Let me tell you a little of what I know about premarket trading. If you blindly pick a price and the stock is falling you might over estimate it's value and not get a fill. In this case you would have to place a sell order at market. This puts you at the mercy of "the system" however based apon the stock being up $5.00 you will have a win. Just how much that win will be is somewhat of an unkown. Part two. A $5.00 premarket jump is a good omen. Here is a 10:20 a.m. look at the same options.
..............................
To be continued. Now a new look at Tesla at 12:42 p.m. It's up 12.47 and the Calls are up impressively.
Would it be time to get out and run? In my world yes. Why? Well if you finsh the week and you have more proftable trades that unprofitable trades your a winner and how you got there is something you quicky forget. The fun of option trading is in the looking for these new opportunites.

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