Featured

Why I Don't Like Trading Options On McDonald's

Same stores sales are up 6.8% in Q4 2025. With inflation and rising labour and food costs, 6.8% is not really very much. Then the rumours about 2,000 or so more outlets opening up this year are the same projections that we heard over the last few years. What they always forget to tell us is the number of their restaurants shutting down. Why might some be shutting down? Well maybe a new highway going is diverting some of the road traffic off in a different direction or a neighbouring high school is closing down. Four years ago they lost some restaurants in Russia. Now look at this. Next this. McDonald's trading on the close back on Thursday. It had a good day. There is new talk about a bigger and better "Big Arch" meal with a bigger burger with a better tangy and creamy sauce. Now this. Today's one day chart. It's Monday. Now it's one day of Call option trading. Look at the volume of trading on these Call options. Over 6,000 contracts. The open interest ...
Post a Comment

"One Day" Expiring Call Options on Tesla And Why It's So Easy To Get Caught Trading It The Wrong Way.

Let's start with a five day chart on Friday morning. Tesla on todays opening is tradng flat. Is that good or bad if your'e looking for a buy in situation. Doesn't a flat opening tell you to stay away?
O.K. stay away and come back to it a lunchtime. Now this.
Here we are at noon. Nothing much has changed. Well you could have made good money if you bought Puts around 9:45 a.m. and got out around 11:00 a.m.. What do you think is going happen next? Go up, down or not do anything in the next couple of hours. The deadline to get out is at 3:00 p.m.. Do you have the desire to try this? But first, here is how what the DJIA index is doing..
What now really needs to happen is to have the DJIA index kick up to help drag everything up. That's what happened yesterday to Tesla as the indexes gained about 165 points on 36 minutes. Let me quickly show you how yesterday's Calls jumped.
That's the kind of movement Tesla is known for. Now let's get back to today's action. What about doing a Friday's afternoon Tesla option trade looking for it to move up? Look at this.
They look well priced but are they? Here is how they were trading at the 3:00 p.m. sell-out deadline.
This was a three hour ride which ended up costing money to be in. The DJIA index closed down.
So what is my message? Tesla can suprise on the upside however it usually does so in conjunction with the DJIA index going up. That didn't happen today. Let's end this blog with a look at how the 440 series of Puts on it traded on the day. They traded down to $.36 a contract (or thirty six dollars) about ten minutes into the opening session. Then they quickly went up to a high of $5.32.(five hundred and thirty two dollars)
Are you up to the challenge of playing "one-day" Tesla options? Now this, Tesla has an earning report coming out after the market closes on January 28th..

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

Another Blog On "Vinfast"

Image
There is so much to read about this companies history online. Do your own homework. Their success is not dependent on what ends up happening with their sales in North America. They are nimble. There are plenty of auto factories all over the world now for sale they can acquire. They have dabbled in Australia. Having access to money to keep going doesn't seem to be their problem. Rivian also seems to enjoy this advantage. Vinfast is currently building a new plant in India which could employ thousands of people. That's an emerging new market. New relationships are being built and new investors will be coming onboard. Are option players looking at this stock? Not really if we look at these "one-month-out" Calls. What about Calls further out? What about next January? Here is a look at the three and four series of Calls. Nobody seems willing to bet Vinfast Calls. Now this. Here are two snippets taken from a blog I wrote about this stock back in early December of 2024. ...
Read more