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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 events like the release farm payroll numbers or other economic numbers 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 other stocks that got knocked do...
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An Obsession With Snowflake On A Friday Morning

Let's continue with a printout showing how the 170 Calls that expire today closed yesterday on Thursday. Stocks in this price range are known to fluctuate two or three dollars in one day.
In yesterday's blog I said "I don't like it's sideways moving action. To me it doesn't inspire a Friday morning bounce." So here we are today and look at this early morning action.
So the stock is down 26 cents four minutes after the opening. No big deal. It's not big enough of a decline to make you want to jump and to catch a reversal. Had it quickly dropped two dollars and the Call options dropped to fifty or sixty cents then a wave of bargain hunters would be jumping in. In the next printout it is down slightly more.
The above five chart shows this sideways action I talked about. Now this, a sudden dip at 9:48:00 a.m. and the 170 Calls become toast.
The 170 Call options drop sharply in price.
That's why holding a 170 Call bought at Thursday at the close hoping for a bounce on the opening would have being a bad call.
At 10:45 a.m. it only gets worse.
At this point in the exercise it's kind of game over. Seeing a stock go sideways all day on a Thursday makes it a fools game to be looking at the upside on the following day. Here is how the 170 Calls closed the day.
The Puts are where the action is. Now quickly read about this. It will open your eyes to how the super rich play the same game in a much bigger way. It's not about Snowflake but it's about another stock called First Solar. All stocks can be exposed to the super rich placing option bets.
Can you see how option traders are swimming in a sea of sharks? Now a quick recap of the action in the Puts starting with a one day look at how Snowflake traded on the day. Look at where the Puts were trading at 9:36:37 a.m.
Look at how low the volume of trading was in this series of Puts. Now a look at how high the Puts reached during the day.
Learn to understand that the five minute point into the markets on Friday morning on "one-day" options often are pivotal.

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