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How Option Makers Are Trying To "Close The Door" On Afternoon Last Day Option Trading"

This is something new that is affecting retail option traders which I have never really paid attention to before. I guess I am always learning. Option makers are taking steps to steer option traders away from chasing the option market from 1:00 p.m. to 3:00 p.m. on the "last-day-Friday-afternoon-options". It's only noticable on certain stocks like Exxon. I just came apon this after writing a blog about trading friday morning one day Call options on Exxon. Look at the "bid-and-ask" on this series of Calls on Exxon at 1:11.p.m. Look at how wide the spread is. Sixty one cents! That's crazy wide and if your stuck in a postion that you want to get out of at a fair price well good luck. Placing in a sell ticket by spliting the difference between the bid and ask would probably cause the bid to drop. This would force you to lower your asking price once again. In other words the liquidity is not there. This is in spite of it's mornings option trading being bris...
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The CarMax Story Continues.

Yesterday holding Calls on this stock turned out to be a walk in the part. See yesterday's chart. Today is a different story. A potential lawsuit is brewing. It is claimed that management provided false guidance. I don't think that this case is going to gain much traction.
Managment said.
So the Calls we were looking at yesterday took a hit and here is how it's afternoon chart is trading.
Rather than looking at the 47.50 Calls we were looking at yesterday we should now be looking at the 45 series of Calls. That's the luxury that "in-and-out" short term daytraders have. Now the 45 series of Calls options that offer leverage on one dollars moves and not the 47.50 series. Here are two different series to look at, one series that expires a week Friday away and one series that expires on November 21st. Next weeks Calls would be cutting the timeline to short.
But here now is the problem. The happy, zippy little chart pattern we saw in the last three of four days is now broken. The fresh lawsuit news is a new minor annoyance.
Yet another problem is that I don't like trading options on stocks in this price range. I like better options on $5.00 and $10.00 stocks and options on $100.00 priced stocks and higher. Here is it's closing day reading.
The October 17th Calls are still ten days away. Let's follow this and see how it turns out. Now here is Wednesday's closing.
There was further weakness. To be continued.

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