Featured

Boeing Has A Strong Opening And Crosscurrents In Mid Week Short Term Option Trading.

Look at it's chart. Now how one series of it's Call options closed the previous day. Now it's ten minute action. The $2.81 price is now $7.70. How do you now feel about looking at the downside? Look at these details. .... Reversals are more likely to happen in the afternoons, not the mornings. I like midweek option trading on stocks in the $225.00 price range. Now here we are at 12:59 .p.m. Nothing has really changed. That kind of makes sense because it is exactly at the point of middle of the week trading. To be continued. Now a 2:37 p.m. update. The NASDAQ is super strong. Getting stuck in this position wasn't the name of the game. The markets were strong on the news of peace with the price of oil coming down. The real winners where the people who got in on the close yesterday who benefited from this morning's bounce. So many of the daily moves now happening are politically induced. This isn't the brightest of positions to now be stuck in. Now Thurs...
Post a Comment

It's Almost Spring - Home Depot

On Monday I talked about two things. First I talked about catching Tesla dropping in price as the markets sold off after a super strong initial surge upwards. Then I talked about Calls on a stock called Super Micro Computer and how it's seventy one year old co-founder got arrested causing the stock to drop over 30% in one day and playing it using Calls for a slight rebound. Both of those situations were one day, relatively straight forward trades. This blog today on Tuesday leading into Wednesday is different. Home Depot jumped upwards in price on Monday partly on "self-promotional" news and then dropped a touch. Here we now are looking a Home Depot at 1:30 p.m. on Tuesday. As you can see it has rebounded somewhat. The DJIA is trading relatively flat.
....
It's a good news story but might it be running out of steam? Once again, at 1:30 p.m. according to the volume of Puts bought it looks like it is not going to. Traders do not appear to be jumping into the downside. Here is a look at it's 330 series of Puts.
I am not a big fan of playing options on stocks like Home Depot, Lowes others in this retail space. I find they can run up or down on misinformation. In any event, I think the sentiment on this stock can turn negative very quickly. Higher energy prices will place a drag on margins. Costco is feeling the same pain, trading down from it's recent $1,000.00 dollar prie range. I have recently talked about that. Here is a statement made yesterday by a company exective which feels somewhat shallow.
Let's watch this 330 series of Puts which expire this coming Friday. Now this fifteen minutes later. The stock is holding tough.
Now this. An end of the day reading.
Here is how the markets closed the day.
At this point anything can happen. In a way it watching is situation unfold is a mistake I should have avoided. Holding overnight option positions on Tuesday evenings on a stock that spent most of it's afternoon trading life going sideways is not a good thing to do. Home Depot is not in a freefall mode. With three full days of trading life in these options anything can still happen. Yet honestly there is no real reason to be in these Puts. Let's see what happens. Now this in the premarkets.
These readings often end up being wrong. Now a 10:40 a.m. readout.
Now this at 10:58.
Take back your money and get out. Two points to be learned. 1) Tuesday afternoon options that expire on Friday are usually "ambiguous" trades. 2) Premarket numbers can lie. ** Now a Thursday at the close look at the 330 Puts.
The gentle decline in the in the stock's price on Thursday was not reflected in the pricings of it's 330 Puts that expire on Friday. The time value pricing part of the equastion is quickly decreasing Let's see what happens. Will the markets continue to down on Friday? Yes!
I don't know why so few traders saw this coming. The DJIA was down 793 points on the day.

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