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McDonald's. It's Difficult To Fight Strong Stocks.

Here is McDonalds five day chart at the close on Wednesday. Now here is it's three month chart. Now consider this. In two days the stock is up about twelve dollars. I often talk about Wednesdays being the one day in the week the markets can do reverals. Today the DJIA was up over four hundred points and McDonalds was down 60 cents. It dipped on the opening and came back a bit and then selling pressure came into the stock again on the closing. I personally hate McDonald's food. The internet has tens of Youtube videos saying their fries are poisonous. Yet I get it. But think about this. Whenever a new residential subdivision goes in anywhere in North America there is room for another one of their restaurants to go in. They just pop up and everyone knows what they are. Here now is a snippet I posted in a past McDonald's blog. After a lackluster trading session today McDonald's could drop in the next two days or at least on a Thursday afternoon sell off. Yet nothing m...
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Can You Play Deere For A Friday Morning Pop? It's Tricky.

Maybe, here is it's five day chart at the close on a Thursday. Yet a five day chart isn't going to help you in figuring out what is going to happen next.
Which way, up or down? Here are the slightly "out-of-the" money Calls as of a Thursday June 6th closing with one day to go in their trading life.
You can see more people like the upside than the downside? That's always the way it seems to be. Now here are some slightly "in-the-money" Puts.
The stock has gone sideways all week. The number of open contracts on these now "one-day" options are very light so that will have no effect on which way this stock will move. Recent history tells us that one day Friday reversals on this stock are a frequent occurance. Wait until it opens and moves in one direction and then get before it moves in opposite diection. Buy "out-of the-money" options and hope for a three dollar swing in the options. That's not much of a strategy and look at how few traders are playing that game. No one really is. Yet recent histories tells us one day reversals off this magnitude are a very common occurance. Is this a reckless trade? Yes very reckless. If however you are coming off a quick win from playing options on something else it might be something you might feel comfortable entertaining. Let's watch now and see how this situation plays itself. It tanked on the opening and quickly pulled itself up.
Here was the opportunity to play a reversal.
This all happened in the first hour of trading. Now here is how it was trading at 1:15 p.m.
Now the final one day chart.
Remember with option trading the rule is on Friday retail traders must be out of their option positons at 3 p.m.. Now the five day chart.
It's funny when you can double your money or make even more on a trading day when the stock really didn't do anything.

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