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The Trade Of The Week

Boeing Calls suprised on Friday. The stock dipped at 10:00 a.m. So did the Boeing "at-the-money" Calls at that exact time. I often talk about Boeing options, most usually in the context of purchasing one week out Call options on Boeing at 3:59:56 p.m. or 3:59:57 p.m. on Fridays "at market" looking for jump upwards on monday mornings. I also note that 10:00 a.m. as well as 12:00 a.m. are commonly periods of time in the trading sessions where reversals in stock prices can take place. This phenomena is not an illusion. In this instance, there was an opportunity to pay $20.00 per contract for one day Call options on Boeing that were expiring that day which ended up closing the day at $990.00 Your timing in doing this had to be spot on. In all fairness it is not everyday that Boeing jumps up almost 5% in one trading session. Call options on Boeing at that time which where "out-of-the-money" had even more extreme upward moves. I don't want to bore you howe...
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Caterpillar Jumped $32.09 On The Week

Not a bad week.
Here is how it traded on Friday. It was up $7.28 however it was losing steam towards the end of the trading session.
Here is how one of it's Call option series traded on Friday.
A couple of comments. Look at the low interest in the outstanding number of option contracts in this one series shown. Option traders don't like trading them. Their earning report for the quarter doesn't come put until Oct 29th. Earnings per share this year are expected to be around $18.00 per share compared to $21.00 in 2023. Caterpillar is helped by interest rates coming down and the increased interest in mining actitives and AI biulding infrastructure projects.How true any of this? One can only guess. The stock Deere and Co. in contrast was down $1.11 on the week. Farmers are in trouble.
Now let's look at Caterpillars 30 day chart.
Now a look at these three series of "out-of-the-money" Puts that will expire at the end of this week. No one is wanting to trade them.
It's hard to fight upward sentiment. Now this, a readout of one of next weeks "in-the-money-Puts".
Five trading session ago Caterpillar was trading at $470.00. Charging stocks like Caterpillar are difficult to play on the downside. So few option traders want to play it on the downside. Now this, a look at one series of Puts that traded On Friday Oct. 3th. If you look at it's one day chart you will see that it sold off between 12:45 p.m. and 2:15 p.m. Around this 12:45 p.m. time period the 500 series of Puts sold off to their lows of the day down to one cent a contract! There was an opportunity profit on that mid day slide.
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It's only on a Friday that one day moves of this magnitude would have such a direct effect on the trading patterns of short term options like this. But who would would be brave enough to purchase Puts $5.00 "out-of-the money" with only three hours of trading time left in them? If Caterpillar jumps again on Monday morning expect to see some traders starting to think about looking at the downside action.

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