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Walmart Again

On Monday I did a blog on buying this week's Call options on Walmart for a morning move. Today is now Thursday and there was a big sell off in the markets yesterday. Tesla sold off for example and here is what happened to it. Today it is slightly rebounding as are so many other stocks. Thursdays however as oftened mentioned in recent blogs are not a good time to be purchasing one day options on stocks that expire the next day. Times change. In less chaotic times that's not always case. In the last few years there would be known upcoming Friday morning events like the release farm payroll numbers or other economic readings that would move the needle on the markets going up or down on on a Friday morning. In those markets it paid to get into option positions before the closing on a Thursday to get out on the Friday morning bounces were caused by the release of these premarket reports. So how is any of this revelant to Walmart's trading today? Well, there was a whole bunch o...
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Lowes / Apple

The first trading morning of the week are always difficult to play because the premiums on Call and Put options which expire on Friday are always excessive. In this instance Monday was a holiday so today, Tuesday was the first day of the week. I found myself focused on 'Lowes' because it was dropping in price when everything else I usually follow seemed to be going up. I had played it last week. Here is what I did.
In at 10:53 a.m. at $4.06 and out at 11:53 at $4.63. A one hour trade. Here is it's chart, I caught the rebound.
What was odd about this trade? Well look at how few contracts traded early in the morning.
Only one contract traded in the first ten minutes of trading and at 10:53 a.m. only two contracts had traded. In total there was only thirty five outstanding contracts. What a crazy low number.
Contrast these open interest numbers and daily number of contracts traded to the action on the day in "Apple". The numbers you are about to see are shocking.
63,361 contracts ended up trading on this series of Call options in one day with an open interest at the end of the day of only 4,565 contracts. So many traders are making this series of options as "go to" options looking to capitalize on daily market swings. They are inexpensive, move up and down quickly and offer instant liquidity. Playes sometime purchase them in quantities of one hundred or more at a time. Here is "Apples" one day chart.
I did a feable trade in it and got out and broke even. it's all about catching an interday swing and getting out. Here is how they traded on the day and here is what did. I was lucky to get out and call the trade a wash. It ended up closing lower.
The takeaway on all of this is that traders are now using "Apple" Calls as a trading vehicle in a big way.

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