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Insane One Day Action on Caterpillar And Deere In One Day

First Caterpillar. I can't make this kind if stuff up. .......... Only 136 contracts in this one seies traded today.That's nothing. I have being commenting on these low numbers in recent periods of time. We hear the terminology "buy-on-the-dips". I didn't see that happening today. Deere the same thing however it's Call action was less inspiring.. Very few Deere Calls traded. Here is how the DJIA traded on the day. Now their thirty day charts. First Caterpillar. Now Deere. Look at Caterpillars one day chart yesterday. One series of options traded down to $4.00 to only then rebound to $23.00. That was the play of the week. Once again, Wednesdays like I have said fifty times before are the best days on the week to look for reverals on "one-week-to-expiring options". At this point in time I would skip playing the Thursday last "two-days-to-expiring options" on these two stocks and check back into the action on Friday to only look at Te...
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" The Respect That Boeing Options Command." Part Three

In a recent blog (on Oct 1st) I said if you bought short term Call options on Boeing on a Wednesday and earned a profit that day, just take it. I also said don't buy Thursday Boeing Call options hoping for a Friday morning "Boeing bounce". Friday option playing can be done on an hour-to-hour basis looking to go against short term rises or dips. Then there is the startegy of buying Call or Put options on the stock on Friday near the close looking for a Monday morning bounce. Most traders using this strategy are looking for an upwards bounce. Remember in this case on Friday, the markets closed down well over 800 points and the Boeing stock took a hit. It would have taken courage to be thinking of jumping in at this point.
Shown above is Boeing's five day chart showing the big drop on Friday and the rebound on Monday.
Yes you could say that it's an expensive trade to get into for a gain that is not all that significant. The gain on Monday was like 39%. (One of the reasons for Boeing getting knocked down last week was the news of a possible cancellation of some airplane orders). The truth is Boeing can't build them fast enough and the reason for the possible cancellations had nothing to do with the potential buyer not needing them. The demand is still there and still growing all the time. Tuesday was a nothing day with Boeing off $1.26. In a blog I wrote last Thursday on Boeing (Oct 9th) I suggested buying the $217.50 "one-week-out" Call options over the "one-day-out" Calls options. Friday's markets were a blood bath and the markets, as measured by the D.J.I.A index dropping 873 points. The one day to expiracy Calls which I said to avoid expired worthless. Now let's move forward. Here now is how those "one-week-out" Call options from last week where trading back then.
Here is how they ended up closing today on Monday.
While they are now still down in price by a significant amount they now have four more trading days life left in them. My point being is that "next-week-out" options, while expensive can still turn out to profitable trades. Let's continue to watch these ones. Here now is Boeing's thirty day chart.
Now Wednesday morning. The clock is ticking.
Thursday at the close is even worse.
To be continued.

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