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Walmart Again

On Monday I did a blog on buying this week's Call options on Walmart. Today is now Thursday and there was a big crash in the markets yesterday. For example, Tesla had an insane selloff. Here is what happened to it. Today it is slightly rebounding as are so many other stocks. Thursdays however as oftened mentioned are not a good time to be purchasing one day options on stocks that expire the next day. So how is any of this revelant to Walmart's trading today? Well, there was a whole bunch other stocks that got knocked yesterday that might now rebound back up again together. Look at the chart below of Walmart and see how it was off a couple of dollars yesterday. Could you buy in now and get out later in the day? Fantasy thinking, one might say. Could it sneak up even one dollar? Now this. The stock mid morning is now merely trading sideways. Now look at this, the 93 series of Calls. (On Monday we were looking at the 94 series of Calls). At 10:22 a.m. the stock is up six cents...
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Sweet Spots In Option Trading - Deere

A fly on the back of a horse. An option contract that expires at the end of the day on a billion dollar company that few traders dare to play options on. A company for the most part void of news releases with Call and Put premiums which are prohibitively expensive. Which stock am I talking about? John Deere. Here is it's five day chart.
Now here is it's one day chart on Friday which is the last day on the above five day chart..
Can you see how it went up in price in the early morning trading and then sold off? Think about how this would effect the Puts. Yet then again who would have the nerve to be playing them?
In the early morning trading they were down to $98.00 a contract and then a few hours latter hit a high of $420.00. Look at how insignificant both the "open interest" numbers and the "volume of contracts" traded numbers were on the day. Friday morning reversals are something that some option traders learn to cherish. If you can't get your head around this idea, I get it. Option trading is afterall a solo experience. Call me timid. I played one Call option contract on Deere (the $402.50 series of Calls) for a two hour hold on Thursday. It's a good thing that I didn't hang onto to it going into the next day.
I didn't want to be holding onto the contract overnight. *** On this stock I find that the option premiums are crazy expense until part way into Thursday and then into Friday when options on it on that day expire at 3:00 p.m. ****** One final thought which I am hoping might help to further quantify the risk involved in making this type of "last day" option trade. Deere hit a high of $411.69 in early Friday morning trading. That's when the 410 Puts went down to $98.00 a contract. On a stock which is known to swing five dollars in anyone day isn't it conceivable the stock could drop in price over it's next five hours of trading? PART TWO OF THIS STORY. Deere drops $20.00 on the day, Thursday May 16th on trade talks. Look at this five day chart.
Can you shake it all off and buy one day Calls that expire tomorrow?
To be continued. Next Friday May 17th. In the last day Deere got dumped on with fears over trade war talks. Here are it's new charts. First the thirty minutes into the Friday market chart.
Now it's five day chart.
Next how the Call options which expire today are trading. What a gamble.
To be continued.

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