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One Day Puts On The Stock Eli Lilly At 2.31: p.m. On A Thursday Afternoon

The DJIA is up something like 850 points on the day. Eli Lilly has jumped $50.00 on the day. Happy days are here again. If the markets cool on the opening tomorrow (Friday) could the stock give up some of these gains? If so what would these Puts do? Might the stock give up 25% of what it gained today? Now it's five day and one day chart. $850.00 for a Put on a stock that has jumped up over $50.00 in one day. It's a Put that expires tomorrow. Is this a recipe for failure? At 2:42.00 p.m. the DJIA is up 899 points. Now the action at 2:47:00 p.m. Now this. In at 2:31 p.m. if you like at $850.00 and out 38 minutes later at $1,100.00. That's a gain of $250.00 and all you did was skim a small gain off a hot market. Maybe that could be your trade of the day to avoid all of aggrevations of what might happen next. It would be catching the tail end of a 950 point one day rally. That in itself is not a bad strategy. Now a 3:30 p.m. update. Another small gain. Let's see what ...
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The Trade Of The Year On Caterpillar Calls. It's No Surprise It Happened On A Friday

In a past blog Caterpillar averted a strike and it was noted that the stock jumped to the moon on that news. Caterpillar has a large following and likes good news-made in America stories. Biden avoided his government running out of money late Thursday and on Friday the stock Caterpillar jumped to the moon. It opened higher and kept going up.There is no looking back now at what happened.
My May 29th blog talked about how Caterpillar had slight bounce last Friday morning and the light volume of option trading on it. With the stock going sideways to down all that week playing Call options on it was out of fashion. Things changed on Friday June 2nd. Caterpillar bounced. So here now is a look at how two "out-of-the-money" series of Call options traded on it on Friday.
Look at the open interest numbers going into Friday. Two hundred and ninety five contracts. Few traders were expecting the news to come when it did. This blog could now go in many directions. Last week both Caterpillar and Boeing struggled on the week and option trading volumes dried up. My attitude was not to trade, to wait for better days. I should have known better, the system is a little bit corrupt. Insiders could gain the most from a late Thursday release of good news. A one day pop in the next days options. That is what happened. On Friday the D.J.I. was up over 700 points. The one day options on Caterpillar were star performers. It was the "trade-of-the-year" on Caterpillar Calls. It doesn't look like any of the 100,000 or whatever the number of brokers and analysis there are out were clued into this action. So strange. * Also think about this. Caterpillar has something like 109,100 employees. I don't understand why there isn't more traders in on this action.

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