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McDonalds Was On A High This Week Before Common Sense Kicked In

There was news. McDonald's is winning at drawing it's customers back in. Quarterly earning were released this week. The stock jumped on Thursday on this news. See this chart. Now it's Puts trading on Friday, the day after. Logic has suddenly set in. With gas prices so high who can afford the gas necessary to drive to a McDonalds? A low of $.10 to a high over $5.04. (See the small Friday morning opening bounce upwards which would have driven the Puts at that time down to the $.10 price range). What a trap. You should you be thinking about opportunities like this. Sometimes they happen out of the blue.
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Caterpillar Calls Again.

Last Friday we showed how one series of options traded on that day. Caterpillar was up $21.96 on that day.
The Call options jumped $6.91 or 46.96 %. Only 13 contracts traded on the day. Today Monday was not much different. Caterpillar jumped upwards on the day. The same series of Call options, the 665 Calls with the same striking price jumped again (only on one contract) and closed the day bid $37.95 - ask- $40.40.
It helped that the DJIA also jumped up.
Now here is it's five day chart.
All this on no real news except the focus on the angle that it makes power generators which are in demand. So Caterpillar is up over $50.00 in only two days. What to do? Buy these short term Puts that expire this Friday?
Fighting strong stocks at the start of the week using "close-to-expiring" options is a major risk to take with so many stocks now trading comfortably in nose bleeding territories. Now this. It's one month chart.
Trading volumes are up.
When stocks get hot like this something has to give. The question is when. I think it will be soon.

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