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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 ...
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The Caterpillar Option Trade of The Week. (For The Week Ending April 19th,2024)

It happened on Friday. But first this news.
Now here is Caterpillars one day trading chart for Friday April 19th.
So the stock was up in the first hour of trading. It' a friday and anything could happen. Are buyers getting in to be part of the good news earning report? Does that set off alarm bells? A red light or a green light? Is it time for some counterintuitive thinking? Now look at this.
A look at how the 357.50 Puts closed on the day. There are other series I could show however these particular ones best illustrate the point I want to make. Can you see the low of the day on these Puts? Can you see where it says $70.00 a contract? As the stock marched up smartly on the opening this series of Puts was under pressure. If Caterpillar kept going up these options would expire worthless. The exact time period I am talking about was somewhere around 10:15 a.m.. Fast forward the time period to around 12:50 p.m. Look at how the Puts jumped up to $5.00! That was the trade of the week on Caterpillar options. Too complicated a trade you might say? Look again. It was actually pretty simple.

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Living on Kraft Dinner?

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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 ...
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