According to the Yahoo earnings calendar, McDonalds is scheduled to release earnings on Monday.  Options traders are taking a bullish view on McDonalds, as seen from the February option chain below.  There are just under four weeks remaining before February options expiration.  The 60 strike calls traded 10,870 contracts on Friday, more than the entire open interest (9,426) of contracts.  Compare that level to the February Puts, which traded only a fraction of the volume, and it becomes obvious that somebody out there is taking a bullish stance ahead of McDonalds earnings.


Is following the herd the way to make money in McDonalds?  In the words of Bruno, “Ich don’t think so”!  Don’t forget it was also the herds that valued Goldman Sachs over $200, Citibank over $50, and Bear Sterns, Lehman Brothers and Indymac as solvent institutions!  I won’t risk shorting McDonalds ahead of the insanity on Monday, but I will look into taking a new short position if the lunatics bid their shares up AFTER earnings.

Disclosure:  No current position on McDonalds.

Disclaimer:  Trade at your own risk!
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