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A Random Walk In The Park On A Monday Morning. A Caution. Monday Mornings Are Often Not An Option Players Best Friend

Let's start with this. It's now 10:26 a.m. A bet on Caterpillar rebounding by the end of the week. There are no takers. Why have to watch the screen for the next four days in agony waiting for a rebound which if happens is just a "break even trade"? But Wait. I made a mistake. The market is actually now down 668 points. What else can we look at? Interactive Brokers. These kind of stocks always do poorly on days with the threat of margin calls. Yet there is something interesting about the printout I am about to show. It is that these options are "one-month-out" Calls. These longer term options trade differently than short term options. (these options trade in one month intervals). If the stock we are following stops it's freefall the value of the options will nudge up ten, fifteen or twenty percent. A seven dollar option Call might creep back up to $8.00 or $9.00 at which time it could be sold. In contrast with a five day option a slight reversal in ...
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"Ford" Down One Dollar On The Opening.

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That's a huge number and it happened in the first thirty minutes of trading. For an option trader it doesn't really matter why. How do you profit on such a move? It's a Thursday. Do you buy "Calls" that expire tomorrow? No, you look one week down the road. Did I buy any? Well I wonder if the dip is so significant that any kind of a rebound will be a struggle. I would buy the stock now but not the options on it. If you buy for example ten of the "Ford" eleven dollar "Calls" for May 21st you will be shelling out lets say $460.00 for a position that might be worth $660.00 on a twenty five or thirty cent rebound. Numbers like that don't excite me very much. Perhaps the "Calls" six or nine months out or so would be a better way to go. Here is a look at a January series of "Call" options. Look at how much they sold off in one hour of trading time! For options nine months out that's a big deal.
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"Big Fools - Gamestop - Stuff"

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Look at this chart and I will tell you what happened. One day back in January of this year "Elon Musk" inadvertently referenced the wrong stock called "Signal Advance Inc." and as you can see it went crazy. Instant profits for some lucky shareholders. The chart doesn't tell the whole story. If you look at the January 11th printout what you will see is that the stock started the day at $7.49, went to $70.85 and backed off to close at $31.51. Now here is where it is trading today, down in the $2.20 range. It traded 2.3 million shares on Jan 11th, the day of it's high and now it trades on avarage something like 12,000 shares a day. Now here is the "Gamestop" chart. It's taking longer to crash down to earth. Next is "Sernova Corp.", a London Ontario based stock. On January 7th it was trading at .62 cents and ten days later on Jan 17th, 8.7 million shares traded in one day and closed at $2.42. Now it's backed off in price to $1.48 ...
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