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What Can Happen With One Day Options On A Friday when the "DJIA " Jumps 600 Points

When I sit with my friends on the weekend do I tell them about how Walmart call options traded on the previous day? If I am riding the subway do I talk to the guy next to me about this? Do I tell my boss? My point is, no one cares. People have soceer games to go, cars in getting fixed and all kinds of stresses to deal with. Who wants to watch their computer screens all day trying to outsmart the markets. I get it. Yet if you were good at it, wouldn't this be a fun hobby to have? Now this. A recap of what happened this past Friday. Now a look at one series of Call options with a focus on the high of the day and low on the day contract price. Look at the jump. Now a look at it's one day trading chart. The markets don't usually rally this much on a Friday afternoon. In a way it's a game of being in the right place at the right time. Yet there more to it than that. Knowing what to look for is equally as important. I note that seldom do one day Call options turn out th...
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Caterpillar - An Observation That Defies Logic

This observation totally defies logic. The markets go up somes days and down some days. It's something like 50:50 right? How do you explain this? Here is how Caterpillar traded on Thursday Dec. 14th.
Yes Caterpillar is on a role.
It is up 14 of the last 15 days. Now here is the only news I could find on it this morning.
This isn't really news because it's dividend was never really in question. Come to think of it, it's really bad news given that earnings were up strongly in the last quarter. Why isn't the company sharing it's profits? Is it buying back shares? Now here is a chart from September showing how Caterpillar gave up a gain on a Friday. It could happen again?
So now what? Look at this.
It's the 285 Puts on the close today with only one day to go. Look at the open interest. ZERO! Look how cheap they are. Couldn't the stock retrace half of it's gain? Why aren't traders looking at this? Even if I am wrong I find it so strange that traders do not see the value in this! On the flip side here is the open interest on the Calls. All of this is so interesting to me. Now a look at the Calls.
All of these traders are hoping for a pop on the opening and some traders are willing to pay money for the $290.00 Calls.
Here shown about was its Fridays morning chart and here are some of the Call and Put printouts. First the Calls. Remember they closed at $1.86.
Now the Puts near the opening. Remember they closed at $1.89.
Then this. Two hours into the trading things were holding steady. Where was the big dip we were hoping for? What happened to the hope of a five or seven, or even $15.00 decline?
Now here is the chart on the day.
Finally this at the end of the day. This series of Puts expired "out-of-the-money" and the final trade was at $.05..
The stock somehow was steady all day and both the Call and Puts holders got burnt. Here is the new five day chart. Are there lessons to be learned? Well if the open interest in a series of Puts you are looking at is zero, you should spend more time thinking why that is. Secondly if you were in the position of hanging onto the 385 Puts you had opportunities to get out and get most of your money back. Maybe in future trades when you find yourself in the same situation let this experience be your guide. Yet that doen't mean it never happens.

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