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Caterpillar Calls Rock

They keep going up. Yet this morning, a Monday morning the DJIA is down. Can you fight a strong stock or are you just throwing money into the wind? Deere, Caterpillar and Boeing are all also on an upward terror. Now a look at these Caterpillar Puts at 10:41 a.m. which expire at the end of the week. The open interest in this series of Puts going into todays trading session is zero. What about the action in the Calls. Are option traders playing them? Well yes and no. The 630 series of Calls have almost doubled on in price on the day but the volume of trading in them is not all that inspiring. Now let's go back and look again at the 642.50 we looked at back at 10:41 a.m..Here is how they closed out the day. The D.J.I.A. index never came back. Shown above is Caterpillar's one and five day chart. Is this "step-up" chart formation suddenly starting to crumble? That's the question. Tomorrow openings will likely see Caterpillar up or down $5.00. Maybe this time, ...
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Ford Puts - sometimes they will surprise!

Back to an old friend. This blog is about why trading stock options on the stock "Ford Motors" can suprise. It's also about trading options I call "penny like options". In this instance I am trading options priced at twelve cents. For first time readers that really means $12.00. Now, a one day and five day chart on Ford. Can you see how volatile the stock is as of late?
Now the five day.
Now a look at it's trading in the morning today up until 11:30 a.m..
Now here is my trading experience on the day.
20 contracts in at 10:05 a.m. at $12.00 each and out at 10:38 a.m. for $18.00 each. That's six dollars profit a contract. It all happened very quickly. Are you able to look at the chart above and see how the chart dipped during that period of time? If you don't play options and want to don't start by making trades like this. Well then again some traders only only make trades like this. It's not uncommon to see a $300.00 trade quicky go to $3,000. It's Ford. Times are changing and Ford feels it most. This leads to yet another point. Being a trader is not everyones cup of tea. Ford options are just something that most people would not want to be thinking about. Pity. ***** Yet another example. This time on a Thursday with one hour and eight minutes to go in the trading session. Take a minute and try to figure out what is happening.
Ford is up .12 cents on the day. Think of what would happen if it ever gave up this gain by the end of the day or on tomorrow's opening. Welcome to trading Ford options. *** Here they are seven minutes into the Friday morning trading session. Yes there was a profit to be made.

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