Featured

"End Of The Day" Friday Option Trading On Tesla

Back on April 2nd I did a blog called "Two Hour End Of Week Option Trading on Tesla". In that blog it was noted that Tesla dropped in price starting at 1:30 p.m. and 42 minutes later it was $5.95 lower in price, approaching the "must-get-out" at 3:00 p.m. mandated option deadline. Put option buyers getting in around 2:00 p.m. did well on their investments. (The stock was down $20.67 on the day). Here was it's chart on that day. It was a Thursday with Friday being Good Friday. Now let's fast forward to today's action, it being the following Friday. Tesla options had a tough start to the day. Here an example of what I am talking about. Look at the 347.50 series of Calls at 12:34 p.m. Are you able to see how they are down in price on the day? Now this. A look at how these same options closed out the day. They charged back upwards towards the close. The $140.00 option price we were looking at below is actually a 4:00 p.m. readout. This chart shows Tesla ...
Post a Comment

Two Hour End Of Week Option Trading On Tesla

I didn't catch it but it was there for the taking. Options on Tesla are one of the world's most actively traded options. Tens of thousands of these contracts trade everyday. It's best to trade them using only recently made profits. At 1:20 p.m. Tesla was trading at $366.00 and then forty two minutes later it was trading at $360.05 That's a $5.95 drop. It's one day chart shows us that move however it is barely noticeable. It had larger drops than that earlier in the day. Here is it's five day and one day charts.
Here is a better one day chart.
It's drop starting around 1:20 p.m. is more noticeable with this chart. The Call and Put options expire at 3:00 p.m.. Now this.
This chart shows us the timing that these Puts jumped in price. So here is a question. Who is going to be stupid enough to be playing around with Tesla Puts that expire in less than two hours? The answer is traders clued to their computer screens watching these options go from $1.00 to $1.25 to $1.75 to $2.00 and beyond in a matter of minutes. Knowing that there is a possibilty that this could happen means that a small subsection of short term option traders are on call to reacte to movements like this. The scary part is that automated trading systems can be programmed also to catch this kind of action. I would now like to end this blog with a reference to a blog I did on March 31st entitled "Caterpillar,Telsa And Nivdia Puts On A Thursday Afternoon". It's 3:40 p.m. Tesla was up $16.60 on the day and the DJIA was about to close 1,000 points higher. In the closing minutes of trading I pinpointed it's Puts move up from $190.00 a contract to $365.00 a contract in the last few minutes of trading. Mid to end of the week Puts, on "end-of-day" option trading on Tesla can be at times very profitable.

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