Options Traders Call Bottom On Ford Slide

Calls have been preferred for some time now

Managing Editor
Oct 24, 2019 at 2:36 PM
facebook X logo linkedin


While Tesla (TSLA) shocked the auto world with its earnings beat yesterday evening, Ford Motor Company (NYSE:F) hasn't been so lucky. Ford shares are down 7% to trade at $8.56, after the carmaker cut its full-year earnings forecast, citing weak demand in China and higher warranty costs.  

Also weighing on Ford is a 50-cent price-target cut to $9 from $9.50 at RBC. There's certainly room for more bear notes, considering the security's consensus 12-month price target of $10.36 is a 20.8% premium to its current perch. Ford stock is on track to post its worst single-session drop since July 25, although the $8.40-$8.50 level has once again emerged as support. 

MAO F Oct 24

In response to today's slide, Ford options traders have come out of the woodwork with an emphasis on calls. With just under two hours left in trading, more than 140,000 calls have crossed the tape so far -- five times the average intraday amount, and volume pacing for the 99th percentile of its annual range. Leading the charge today is the January 2020 10-strike call, where it looks like options traders are selling their positions to close. There are also new positions being opened at the weekly 11/1 8.50-strike call, where buyers are eyeing that supportive $8.50 level for the next two weeks.

Options traders have been more keen to make a play on the auto name lately. The stock just popped up on Schaeffer's Senior Quantitative Analyst Rocky White's list of stocks that have attracted the highest weekly options volume during the past 10 days, with names highlighted in yellow new to the list. In the last two weeks, roughly 260,987 weekly calls have changed hands on F, compared to just 55,109 weekly puts.

MAO Oct 24

However, this emphasis on calls has been more common in recent weeks. This is per the stock's 10-day call/put volume ratio of 1.99 at the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), which indicates nearly two calls have been purchased for every put on Ford during the past two weeks.

 

Target Effortless Triple-Digit Gains Every Sunday Evening For Life!

This is your chance to triple your profit potential on Sunday evenings, without spending all your free time watching the market.

On Sundays, as a Weekend Plus subscriber, you’ll get up to 6 trades every Sunday, each targeting gains of 200% or more.

Start targeting gains like the ones our subscribers have seen recently, including:

213.3% GAIN on AutoNation calls
100.0% GAIN on Monster Beverage calls
100.4% GAIN on Walgreens Boots Alliance puts
100.4% GAIN on ON Semiconductor calls
257.7% GAIN on Dell calls

101.0% GAIN on Apollo Global Management calls
103.6% GAIN on JP Morgan  Chase calls
105.3% GAIN on DraftKings calls
101.3% GAIN on Airbnb calls
203.0% GAIN on Shopify calls
102.0% GAIN on Cboe Global Markets calls
100.9% GAIN on Boeing calls
102.1% GAIN on Microsoft puts
102.3% GAIN on First Solar calls
101.5% GAIN on PulteGroup calls
101.0% GAIN on Apple calls
209.4% GAIN on NXP Semiconductors calls
100.8% GAIN on Uber Technologies calls
100.4% GAIN on Academy Sports and Outdoors puts
102.2% GAIN on Trade Desk calls
100.8% GAIN on DoorDash calls
100.0% GAIN on Camping World Holdings puts
100.0% GAIN on Cboe Global Markets calls
100.2% GAIN on C3.ai calls
238.5% GAIN on Oracle calls

 
 
 


 
 

Rainmaker Ads CGI