CAT Puts

Here is what the market is doing just minutes after the opening. Not much. It's a Friday and I am looking at options that expire today and also looking at options one week out. I will talk about "next-week-options" later. Monday will be a holiday. Here are my trades this morning and a picture of me. When I trade on Friday's it's always the first fifteen minutes of trading that are the most interesting to watch and try to play. Except that is when everything is going down. * Telsa blasted up in the afternoon and the real action was in the Calls. I was lucky on that one to make money on a Put. Buying Calls on the opening that expire that day seems kind of dumb yet that's where smart money went. Look at the Call volume numbers. Lucky on Visa also as the Calls I bought ended up expiring worthless. I was playing the 225 Calls between 9:47 a.m. and 10:36 a.m. Boeing closed at $396.00. I didn't hang in with long enough after it came off a morning dip. On Fr...

First some news as the markets opened. Horwmet Aerospace offered this sobering news. Then good old Joe made this statement. Now the opening chart. When I see opening charts like this I always want to play it in the opposite direction. What was my take on all of this news. New contracts are great, people are flying again and ticket prices are up. It's all good but Boeing doesn't really need more deals and orders. They are still trying to get back on track. Would this morning bounce go away? I thought so, I jumped in on Puts. In at 9:45 a.m., 9:48 a.m. and 9:50 a.m. . I was confident in what I was doing but the stock seemed to stay persistently high. Then I got frustrated with how it was trading and bailed out. I sold all four contracts at 10:42 a.m. at $2.61 per contract so I only made a touch. I was in this position for just under an hour and was starting to worry about a second wave of buying coming into this position. This chart above illustrates how they jumped higher...

I don't like buying Call options on Monday morning that expire on Friday. I tend to find them to expensive. Something unusual happened this morning. There was an announcement. Here it is. February 9th was a Thursday. I congratulate Caterpillar for holding off until the Monday after, today to release this news. Can you imagine announcing it last Friday at noon and having short term Call option holders getting wiped out. So what happened on the opening to Caterpillar today? It tanked. It tanked however it rebounded as the index closed super strong. Now look at how low the Calls traded on the opening and how they came back. I watched it happen but opted not to play it. They opened at $3.90 and dropped to $285.00 before they jumped up. It's not every Monday the D.J.I. rallies over 376 points. Two thoughts. 1) Releasing this kind of news on a Monday morning shows shewardship. 2) I opted not to play it. I don't like buying one week Calls on a Monday morning. That's just m...

In option trading traders get a fair deal on wednesdays if you can capture the right directional move. Stocks can pivot on the day and pivot on a dime. Case in point is Visa. First, look at how it was range bound on the opening. Yet range bound enough to play it. Look at the dips it had in the first ninety minutes of trading. Here is what I did. I played a dip down. In at 10:55 a.m.and out at 11:08 a.m. That's thirteen minutes. Buy five Put contracts at $100.00 and out at $127.00 Points to consider. 1) Market swings like this only seem to happen in morning markets and not afternoon markets. 2) Wednesdays are the best day of the week to look for this action on options that expire two days away. It's like the tippng point of the week and the smallest directional move causes the options to reacte. Now here is how the stock closed the day. Lets now look at the action going into Thursday. Here is how the stock looks in premarkets bids at 5:38 a.m. Watch the 230 Put series as t...

It should be good news but I made the mistake of buying in to soon. If you read to the end of this blog you might say so much work and risk for next to nothing. I understand why you might think that way. I bought Boeing Calls to soon. I bought them last Friday in the early afternoon and I must have being day dreaming about past trades. Why not wait until 3:59 p.m. to buy in "at-market"? Sometimes I don't follow my own self imposed rules. That's option trading. Here is what I did. At 1:43:00 p.m.I bought two Boeing 212.50 Calls at $1.59 each. That's way "out-of-the-money" but it bought me time to the end of next week. Can you see how the stock dropped off late in the afternoon after I got in causing me to lose about 35% of my investment before the closing bell. The thinking was I was bullish on Boeing and was hoping something good would happen over the weekend. Maybe Barrons doing a feature article saying it's time to buy. It didn't, so on Mond...

Who likes trading options that expire that day? Let's move forward. First here is the five day chart of Boeing prior to it's Friday morning opening. It looks like it could bounce. Part two, here is what I did. Look at times I got in. In at 9:32.34 a.m. at thirty-two dollars each on four contracts and out at 9:43.07 a.m. at sixty-nine dollars each and also in at 9:34 a.m. at forty dollars each on two contracts and out 9:44 a.m. at seventy nine dollars. These are ten minute trades picking off doubles in price. Here is a screen shot of how Boeing was trading during this particular period of time. I caught part of a one dollar early morning move up holding "out-of-the-Money" Calls. the ones that move the most percentage wise when they only have about six hours of trading time left in them. That is something to study. Had I waited another ten minutes to get out I would of had given up all of my profits and had I held on to these positions until the end of the day I woul...