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$Caterpillar Calls On A Day The Stock Goes Up $41.00.

Let's start with it's five day chart. Today is Thursday. Here is what the DJIA did on the day. Here is what it's "near-to-the-money" Calls did. What stands out to me? Only 37 contracts traded and an open interest in this series of Calls of 36. This series of Call options expire tomorrow. What about the next week out Call options with the same striking price? How did they trade? It's unusual to have a higher open interest number. What about the longer term Call options, the ones thae expire near the end of July?. There is no real interest in them. What about the "near-to-the-money" Puts that expire tomorrow? Once again the action in them is next to nothing. If the stock gives up half of what it gained today these Puts would triple in value in one day. Now here is Caterpillars "year-to-date" chart. Holding one day to expiring or one week to expiring Call or Put options on stocks like this in the $900.00 price range attracts little in ...
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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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