Featured

Climbing The Wall of Greed.

It's a stupid market with stupid things happening. It's exhausting. Investors have to change out their investment strateties. Caterpillar and Deere had big gains this week and one week Call options on both of them went up in price 400 percent. In recent blogs I have talked about things like coming late to the party and making trades where you would make out like a bandit. Look at this mornings action in "Unusual Machines". I have talked about this stock before. Now this. A look at the Call options on "Unusual Machines" at 9:31 a.m. this morning after the stock jumped $1.57 on the opening. These Call options jumped 300% from their close on the previous day. Also look at the large open interest in these options. These Calls still have one week's life left in them. The question now is who would you be stupid enough to be throwing more money into this? Not me after all this that has happened. Now this. In forty four minutes the Calls that were already u...
Post a Comment

Caterpillar Earnings. Ford Earnings

Here is the spin put on Caterpillar's earning report.
A heathy demand and the abilility to raise prices. No mentioning of the word covid. A referencing to 9% inflation. How management phases each little morsel is so ever important. The stock tanked on the news - on the takeaway that the company was running at full speed in a world of floods, wars and and of infrastructure building. It stock was punished. Strange. Ford had a wild and colorful story. It got punished for reasons which soon become apparent. A company still making millions of dollars in an environment amuck with change. Fourth quarter net income fell.
Tomorrow I will fill you in on why the Friday Call holders wished they had Puts. Here is what happened.
The 12 series of Calls opened up down over 90%. What a wabble. Now here is it's year to date chart.
The story of what is going to happen next with Ford never ends.

Comments

Post a Comment

Popular posts from this blog

Living on Kraft Dinner?

Image
What does the word disconnect mean? As a verb it means "to sever or interrupt the connection of or between; detach". Option trading - one day options - is a disconnect from the world. What happens to slightly "out-of-the-money" Call options on Costco when the stock shoot up thirty dollars on the day? I will show you what happened on Friday to Costco Calls and the options on a few other stocks I frequently watch. What a disconnect from the real world. But before that a look at how the indexes traded. 1) Costco. It's five day chart and a look at how three of it's option series moved upwards in one day. You may not know how to read these printouts but try to read the highs and lows on these option pricings. One printout shows an "at-the-money" option which means you are buying a contract on the stock, good for one day only at a locked in price equal to (or very close to) what the stock is currently trading at. The other two contracts shown are ...
Read more

A Fireside Chat - One Year Options and Thirty Day Options. Which is Better?

Image
Some say to think small, not big. Trying to play Disney options is thinking big. It is a stock slightly out of favor. If we start with it's a three year chart, we will see it is down by about 50% over that period of time. Now it's one year chart. If the stock can break 110 in early 2024 the sky is the limit. It does have a lot of moving parts so anything could happen. Look at these Calls options one year out. One year in options buys a lot of time.They look reasonable. If the stock ever inched up to the $105.00 price level in the three or four months these options would jump up in price by about 50%. Even more if they had really good news. Yet it's the "what-if" aspect of the equation that castes such a trade in doubt. "What if" stories just don't cut it. There are to many variables in play. Then again, why are we even thinking of long-term Call options after a December's rally? Let's switch gears. If consumers are out spending for X-ma...
Read more

The Little Engine That Could

Image
Walmart again. It's all I seem to blog about. Here is it's five day chart. The stock keeps going up and the option series are set up in one dollar spreads. Even a fifty cent move on the stock moves the needle on these Calls. Look at how this series of Calls was trading yesterday at 3:00 p.m.. Now here is this same series of Calls just before noon today. Thirty days of upward action like this punctuated by the off day of decline. Now notice the higher volume of trading in the series of Calls with the higher striking price. These are the ones's with more leverage. At the same time look at the five day chart on Costco. The two stocks sometimes trade in tandem. Humpty dumpty sat on a wall .... a had a great fall. Someday soon a fall might happen but what a great ride it has been.
Read more