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Showing posts from July, 2021

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Why It's Difficult To Play Options With Four Trading Days Left In Them.

The premiums are to expensive. Here is what I mean. Look first at Nvidia. Now look at the price of it's end of week Calls and Puts. Do you see the prices of $7.14 and $720.00? Those are both crazy high numbers. If we look at Walmart it's the very same story. Super expensive Calls and Puts if we are looking four days out. Suprising Exxon with a much more interesting five day chart have options that look somewhat reasonably priced. Look at how few Exxon Puts there are outstanding compared to the Calls. Few traders see any positive Middle East developments. Now consider how this narrative is so much different than the one day action I talked about yesterday on Nvidia's last day to expiring options. One day options offer so much more action. Let's revisit this blog over the next few days or so to add more commentary to this story.
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Caterpillar Earning Report Plays

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So tomorrow is the big day when Caterpillar releases it's second quarter earnings report. It is expected to be good. Boeing just had a great earnings report yesterday and analyst are expecting Caterpillar to also report decent numbers. Let's look at the five day trading charts on these two companies and this mornings super strong premarket indicators. (It's always good to be selling into strong premarket indicators because history tells us that they never stay strong forever). It's July 29th and Caterpillar's earning report is tomorrow. Ford also just had their earning reports and good new also on that front. So far so good? Good news everywhere right? It's only good news if you can capitalize on it. What am I implying? Well I don't want to digress to far off topic however option trading can be an exacerbating experience. I missed the Boeing and Ford trading opportunites despite the fact that I anticipated both of these two companies would do well. Do I...
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The Trade of the Year

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It's not that complicated however it kind of slipped under the radar. It was a big name company we all know called Lowes. The payoff was wild. What are we looking at? Options that closed on Thursday at ten cents a contract and opened at one cent the folling morning, a Friday which then then hit an interday high of one dollar and fifty cents. A one thousand dollar investment would have went as high as $150,000.00. Folks, all of this is legal and anyone can play it. You could have made it all by lunchtime. What happened? Well we are talking about the 200 series on Calls that expired yesterday on Friday July 23th. At the start of the trding session they were over $3.00 "out-of-the money. Very few traders saw value in them. Yet Lowes did close strong on Thursday the day before it. Then it wobbled a touch on the Friday opening and resumed it's upward charge. The price of lumber is dropping and many people are waiting to purchase lumber at these new lowering prices. The kicker ...
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