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Walmart Again

On Monday I did a blog on buying this week's Call options on Walmart for a morning move. Today is now Thursday and there was a big sell off in the markets yesterday. Tesla sold off for example and here is what happened to it. Today it is slightly rebounding as are so many other stocks. Thursdays however as oftened mentioned in recent blogs are not a good time to be purchasing one day options on stocks that expire the next day. Times change. In less chaotic times that's not always case. In the last few years there would be known upcoming Friday morning events like the release farm payroll numbers or other economic readings that would move the needle on the markets going up or down on on a Friday morning. In those markets it paid to get into option positions before the closing on a Thursday to get out on the Friday morning bounces were caused by the release of these premarket reports. So how is any of this revelant to Walmart's trading today? Well, there was a whole bunch o...
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G.M. and Tesla. Both Surprised. So Did Ford.

G.M. is pumping out vehicles and people seem to be buying them! Against that backdrop is that they are losing market share in China.
Falling interest rates should help car sales. Does that mean that the Ford stock will also jump? They report October 28th. Look at it's 30 day chart and year to date chart.
They have a history of earning suprises with some being not so good. Here is how the 11 series of Calls traded on Ford on Friday Oct.26th on next weeks 11 series of Call options.
As these prices the stock would have to jump 40 cents on the week to make these Calls think about coming to life.Here is what happened.
Now there is Tesla which reported their earnings after the markets closed on Wednesday Oct 23th. Here is how it traded on that day just prior to earnings report. The open interest numbers were quite low as sometimes we see like 150,000 contracts trade in one one series in one day.
So the 212.50 series of Calls closed at $9.28. Now look at this chart and the closing price one day later.
Now look at the $212.50 Calls today. Up 418%
This kind of a spike doesn't happen very often. It was the trade of the week. Do I like paying earning report using options on automotive companies? Yes, the action is usually short and swift.

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