"Out-Of-The-Money" Calls On A Stock In The $30.00 Price Range With Three Trading Days To Go

Do I have a secret no one else knows. No. Options priced a $.07 or seven dollars could suprise but you have to be prepared to lose evrything. The stock is once again Pfizer and look at it's five day chart. On this stock and with options in this price range some option traders buy or sell in quanities of 100 contracts at a time.

Reach $30.00 and go even higher in the next three days? After looking at it's chart you might say that's impossible. Here is how the $30.00 series of Calls closed on Tuesday.

So here is the thing. We don't need a full one dollar rally in price to make these Calls jump upwards. Even a $.30 increase would cause these option to double if it where to happen tomorrow morning. Today the stock was up $.12 and the Calls actually dropped 36%. That's kind of strange given there is still three days trading life in them. It didn't help that the DJIA was down 157 points on the day. Now look at the open interest number of 5,004 contracts compared to the daily volume of trading of 1,645 contracts. That's the way these two numbers are stacked up. I want to point out that this is the reverse of how most option trading patterns find themselves set up. Traders for the most part are willing to hold onto their positions at this point in time rather than taking losses. They are willing to stay in the game when things start to look bleak. History has taught them to act this way. It's a make it or break it mentality. With $.07 cents options it's more of a gamble. Let's see what happens.