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Showing posts from January, 2022

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McDonalds Is Having An Upward Run. Why?

Here are one series of it's Puts that expire this Friday. They are "out-of-th-money" so it's going to take a bit of a directional move to get a payout. Now it's five day chart. Is the stock going up because the DJIA is up? This to me is more a play on what the markets are doing than the stock itself. Here is how it closed the day. It's largely unchanged from where it was trading at back at 1:18 p.m.. Here is how the D.J.I.A. closed the day. A weak opening tomorrow will do wonders for this position. Let's see what happens.
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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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