Featured

Walmart - Trying To Outsmart The System

I don't know if it is going to work. Buying a Call and an offsetting Put on the same stock with the same striking price with two days of trading life left in them. The logic is to sell one of the two if it gets a double or more, (hang on as long as you can), and earn a free ride in an offsetting change of direction. Look at this five day chart and you might see how this train of thought developed. Now a look at one Call series and one Put series. These options both have two full days of trading life left in them. Here is it's five day chart which looks like it might break out. It really takes a share price move of over $2.00 quickly, to make this a fun experience. Options priced in the $1.00 range can suprise. It also could be a total bust. Let's follow this action and see how it all plays out.Thursday morning. I missed tracking the action but this is what happened. The Puts really performed. Can you sell out and take a profit and play it for the upside? Hold that thoug...
Post a Comment

Exxon Has Just Had Like Four Days Of Going Up.

Exxon just broke it's previous three month high.
Now it's five day chart. The 117 Calls have doubled or tripled in the last two trading sessions.
Now it's chart as of 10:42 a.m. this morning.
Today is Wednesday. The markets are closing today at 1:00 pm., then closed tomorrow for Christmas and then open again for a full trading day on Friday. Now this. A look first the Calls which are $.30 cents "out-of-the-money" and expire on Friday.
Now the Puts which are already like $.30 "in-the-money".
Expectations are that the stock is going to go up and that there is still a full day of trading on Friday. Here is what the markets and what the price of oil are doing.
Can you see how traders have a preference for the Call options and are hoping Exxon continues it's natural progression upwards. They are prepared to pay somewhat of a premium to be positioned in this situation. I don't know what the outcome is going to be. Nobody does. As a reader can you see the complexities of trying to figure out this outcome? My point is that option trading on Exxon is a fair game. Let's watch and see what happens. Here is how it closed the day. Remember the markets closed at 1:00 p.m..
One thing to notice is the volume of trading today.
Low volumes means big stock movements are less likely to happen. Now Friday morning. Action in the first five minutes of trading. A slight dip and then a light recovery. The Puts didn't really drop enough to make the Put holders any money. Buying the 119 series of Calls on the opening or on the previous close created a double or triple! The 119 series of Calls opened at $.25 as the stock opened down and 72 seconds later was trading at $.70. You had to be buying the Calls right on the opening. There was no time to be messing around. This was a pivotal moment.
....
....
Imagine getting out this early in the day with a healthy return. Now this towards the end of the first thirty minutes of trading. Notice the volume of trading is next to nothing. The remainer of the day for what happens with this series of Calls and Puts has suddenly become inconsequential. The timeline for doing any further trading does no warrent putting fresh money into this position is no matter what the eventual outcome turns out to be. Yet hold that thought. There may still be a suprise.
Part of the allure of trading options on this stock comes from knowing that these types of pivot points exist. ** A late in the day update about one hour left to go.
The morning Puts we saw at $.17 crept back up to $.31 cents. Now two charts (with the first being the Puts) showing how both the Calls and Puts traded on the day.
Finally it's one day chart.
These are dangerous options to play, even for day traders. Morning reversals as of late are the norm.

Comments

Post a Comment

Popular posts from this blog

Waiting For A Drop On The Opening On Bad News - Eli Lilly

Image
Here is the bad news. The company is Eli Lilly. How bad is this news? Well look at it trading in the premarkets. So what do I think? I think the news is a setback of sorts, but not really all that bad. The stock is going to open lower, that's a given. It's like trying to play Boeing after an announcement that an airplane has crashed. So the stock is going to crash and it might have a small rebound and then it's going to slide down some more. A test of sorts will happen sometime in the afternoon. It might stock falling but then where will it go from there? The best case scenario is a recognition that investors got it all wrong and the stock ends up flat on the day. Yet there might be more of a downward dumping of the stock on the close followed by a selloff on tomorrows opening. Should option players be jumping in to play the upside on next week's Calls? That is the question. Here is a look at Boeing on the days after a crash. Day two after the crash was equally as ...
Read more

A Fireside Chat - One Year Options and Thirty Day Options. Which is Better?

Image
Some say to think small, not big. Trying to play Disney options is thinking big. It is a stock slightly out of favor. If we start with it's a three year chart, we will see it is down by about 50% over that period of time. Now it's one year chart. If the stock can break 110 in early 2024 the sky is the limit. It does have a lot of moving parts so anything could happen. Look at these Calls options one year out. One year in options buys a lot of time.They look reasonable. If the stock ever inched up to the $105.00 price level in the three or four months these options would jump up in price by about 50%. Even more if they had really good news. Yet it's the "what-if" aspect of the equation that castes such a trade in doubt. "What if" stories just don't cut it. There are to many variables in play. Then again, why are we even thinking of long-term Call options after a December's rally? Let's switch gears. If consumers are out spending for X-ma...
Read more

News on Polestar , Lucid (Trading After A Reverse Stock Split) Plus Ford News And Vinfast

Image
Look at the one year chart on Polester. Now it's one month chart. What's going on? It's confusing. It was down $.36 cents on the week. If you want you can spend $.20 or $.25 on Puts and hope that the company goes under in the next five or six months. They recently raised more money by releasing more shares so it's running out of options. You can't run at a loss forever and this news will most likely scare off potential new car buyers. This actually is a low number of outstanding Put options. The consensus seems to be that it is not game over yet. Lucid started trading this week on a "one-for-ten" reverse stock split. Here is its one week chart. It was down $1.39 on the week. It's also going to struggle. Both of these stocks have challenges ahead. On a more positive note here is a chart that looks kind of perky. Ford on the week. The stock was down $.03 cents on the week and it was the 3th highest in share volume trading on the NYSE. It appears...
Read more