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Showing posts from January, 2022

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Let's Set the Stage For A Friday Option Ride on Tesla

Tesla has moved sideways all week. That is unusual. Here is what the markets are doing. Now it's morning trading chart and two series of it's options late in the morning. It's 11:51 a.m.. There is also more action in the Calls than the Puts as there always is. Call holders were rewarded in the early morning trading action. Now a different way to present the same material. Now this action on the Calls and Puts a few minutes later at 12:30 p.m. or 31 minutes after our first reading. The Puts have gone from $1.44 to $3.48. Here is how Tesla closed the day. If you could do one trade a week like this you would be a happy camper. ** See my February 13th blog about Telsa dropping on a Friday afternoon.
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Disappointment on The Opening - Caterpillar Earnings Report

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Caterpillar's earnings report. What I see is 4th quarter sales up 23%. Strong 4th quarter earnings of $3.71 per share.That's a solid number. Just think, the supply chain issue isn't being used as a mistake. Now look at the the opening options market. The stock is down on the news. Management made a few remarks about near term headwinds. They do that sometimes to temper growth expectations. These two quotes are the 205 Call series which expire today. One is at 9:44 a.m. and one is at 10:03 a.m.. They would be very dangerous to consider purchasing since its very unlikely that they could ever shake off this downward spike so early in the morning. So now what? It's at this time in the morning when the decision to reacte to this bad news gets tricky. The stock is down like ten dollars and the DJI is having a good day. There is a strong tempation to jump in on the upside hoping for a quick reversal. That's one of the things that makes option trading so difficult. One...
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