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Finding A Trade To Make On Thursdays. "Walmart"

I don't like Thursday afternoons in short term option trading. A lot of things seem to happen on Thursdays like government reports coming out. I don't buy in the final seconds of trading, Call options on Boeing, Caterpillar or Eli Lilly or hoping for a Friday morning bounce. The hope today is to do find something good to trade and walk away by early afternoon. Welcome to Walmart. Options on Walmart are tight. Other stocks like McDonalds have options which trade sloppily. Let me show you what I mean by this. Good luck trying to get a fair fill if you're buying or selling. Now the Walmart side of the story on how options trade on it. Can you see the tighter bid and ask and the higher volume of trading? Step back for a second and consider this. The stock is only up $.26 cents in the first 45 minutes of trading. What does that tell us? It's waiting to decide which way it wants to go. Now this. These Call options went on to move up to $1.71 just before noon. There was the...
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Caterpillar Drops $60.00 In Five Days - Noon On A Wednesday

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In past blogs I have mentioned how light the volume of trading is in Caterpillar options. Trading them is a challenge. Deere options are also like this. Caterpillar can and does (in recent times) swing $10.00 on any given day. It is noon on a Wednesday and this the one day of the week where you can look for reversals on "one-week" options expiring on Friday. I have talked about this many times before. Here are it's five and one day charts. Now a look at two of it's Call option series. The 560 series actually offer excellent value given how large it's morning drop was. Who cares to check the news on it? When it drops this much this quickly the bad news, if any, is already baked into the equastion. Now the second series of Call options I am showing you are $44.00 "out-of-the-money" and expire in 2.5 days. "Out-of-the-money" Calls to this extreme are a speciailty item. In layman's terms they are a longshots. They can be excellent trading veh...
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When All The Drug Stock On Your Watch List Are Down

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Can you pick just one stock on this list for a rebound? Here is my list. Now let's look at Pfizer. I don't like trading short term options on Tuesdays because I know Wednesdays are better days to be looking for meaningfull reversals. When the morning dust settles might these ones look promising for a rebound? The stock is down almost one dollar. The opening market have traders wondering if they should be buying into this dip. What happens if the markets decide to drop 500 or 700 points? Now, here we are 15 minutes later. Can you see with these "in-the-money" 24.5 Calls the option makers have widened their bids and asks. They are getting defensive as this could be an inflection point. At the same time the 25.5 Calls which we first looked at now further "out-of-the-money" have taken a beating. Here they are. Look at this chart at 10:39 a.m. Just the fact we are only about an hour into the trading session tells me that it is still to early to be looking fo...
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Exxon Drops Big On A Late Monday Morning

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Is now a time for a reversal? When Exxon drops like this on a Monday morning it has the weight of the world's problems on it's shoulders. If it dropped double this amount you would know something is actually wrong. Here is it's five and one day charts. So anyone could recognize this. Why pick this time to look for a reversal? What happened to the support level at $118.00? Does the $118.00 level look like a stretch to far away? Now this. We are hoping for a pause in the downward action and hopefully a slight rebound. A rebound to $118.00 would work wonders. Here is it's 11:39 a.m. readout. A further deterioration downwards would be ugly but these Calls don't expire until Friday. The low volume of trading tells us that experienced option traders are not looking for any sort of a quick rebound. Let's see how this plays itself out. Now this, a 2:00 p.m. readout. Now a 4:00 p.m. readout. It took until noon to shake off the weekend sentiment but after that a rebou...
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Recognizing An Oversold Situation On A Monday Morning. Moderna

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Moderna. Let's start with a doggy stock that has a large short position. Now it's opening chart showing five days of trading. It's down. . Here is some news the market is digesting. Isn't this just more news of the same? Now a look at the 28.5 series of Calls at 10:25 a.m.. Now at look at the action at 11:00 a.m. The stock is up 20 cents. It's not enough of a move to get out however the stock is moving in the right direction. Now at 12:11 p.m. there isn't to much new to report. ..... Now this. Now at 12:50 p.m. I would be thinking of watching it trade minute by minute. Now this. It can't get much better than this. I would just get out. The morning fear factor that was attractive on the opening is now long gone. The reasons to now be holding this position have changed. It's called Monday morning daytrading. Selling into strenght can be a remorseful experience but one that most usually is quickly forgotten. I will check back in on this positi...
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