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A "Love-Hate" Relationship With Pfizer Options

Pfizer options often disappoint however there are times when they can be your best friend. Let me try and explain. First look at it's five day chart. The 24.50 series of Calls have more than doubled in price in two days. Volatile stocks like this in this price range attract an inordinate amount of attention when it comes to option trading and it only flares up during these brief periods when the stock has these extreme price moves. Look at the open interest in this one series of Calls below. It's quite substantial. Now for a simple calculation. If the stock moves up today to $25.00 these $.37 cent options on the 24.50 series of options will probably move up to the $.55 cent range. Buy and sell let's say a block of 25 contracts and you will be rewarded with a nice gain. Now let we share this one observation. Here is a look at how the D.J.I.A. traded yesterday. It was down. Who wants to be holding short term Call options overnight if the markets are souring? Wouldn't t...
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A "Get Ready For Monday Morning" Blog . "Avis-Budget" Symbol "CAR"

There is always news. War news. News on gas prices and news that Costco is trying to sue the government over tariff monies. Two weeks ago I mentioned a situation with Super Micro Computer. That stock really got beat up when a company officer was arrested. Now that news is slowly being shrugged off. Now this, the car leasing company Avis has a story. To better help explain what is happening let's look at it's five day chart.
. What's going on? Articles are appearing saying that stocks in this sector are being boosted by TSA Airport chaos. Yet there has to be more news than that. Look at it's latest five day chart.
Here now as shown below is how the 170 series of Calls last Friday closed out the day. On that day alone the stock closed up $20.35 dollars! Options trading at $4.00 jumped up to $21.00! Other stocks in the same sector remained relatively unchanged.
The stock is now in nose bleeding territories.
Obviously options on this stock will be hot potatoes this week. Here we are now at a Thursday close, with the markets being closed the following day for Good Friday. Here are two "near-to-the-money" series of "next-week-out" options to look at. One chart shows the Calls and the other chart shows the Puts. These pricings both offer five more days of trading life.
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How do we play these options moving forward? It's best at this point in time just to wait until tomorrow afternoon to see if you agree with which way the pedulum is moving. It went up so fast. Could it fall just as quickly? Fighting strong stocks is never an exacting science. If you miss trying to play this Monday mornings action I wouldn't lose any sleep over it. It's just to much of a gamble. To be continued. So the stock is up on Monday morning and 50 Put contracts on the 190 series popped onto the screen. So to did a fewer number of contracts in the 200 series of Puts. The fifty contracts might be just one ticket. Stocks can't go up forever but something is driving this stock up..
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Now the closing day readings.
Up over $22.00 on the day. It's always difficult to fight a stock when you never know the entire story. Rumours are it's a short squeeze.
Here is it's current three month chart.
Buyers today were even buying the 250 Calls which expire this week and were not bailing on the close.
You don't see this kind of action very often. It's Tuesday! Up 42.55 on the day.
Look at what the 250 series of Calls that were trading at a low of $.90 cents yesterday or $9.00 a contract are trading at now.
There was a touch of selling presuure just after the opening today however it didn't last long. At this point in time all I can say is that stocks don't go up forever. What a ride this stock had! Did Friday's reality offer some relief? Not really. It sold off and came charging back up again.
Trying to play options on them now is not really feasible. The premiums are to expensive. Moving forward look atthis new five day chart. The story never seems to end.

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