Wednesday’s Options Alerts

  • January 7, 2003
  • Chris Tyler

The Volatility indices are
currently testing the lows established on their respective daily charts. Both
the
(
$VIX |
Quote |
Chart |
News |
PowerRating) and the
(
$VXN |
Quote |
Chart |
News |
PowerRating) finished
close to the unchanged mark, but the situation  looks a little bit more
disturbing when you take into account all the background evidence. Confirmation
of at least a short term top in the ETFs is being confirmed by sell signals in
the CVR system,  price extension in the underlying market indices, as well
as the fore mentioned testing of prior lows within the volatility indices. The
ETFs closed mixed on the session, with the QQQs buoyed by some upgrades in the
software and semiconductor sectors, while the SPYs and DIAs were essentially
flat on the session. 

For additional color commentary on the market
please click on our Nightly
Daytrader’s Report as yours truly writes both features for TM. And as always
let price and volume be your guide through the markets. Have a good night. 

 

Points of Significance:

Volatility
Index		 Close Net
Change		 Signals/Direction %
Above/Below 10 Day Moving Average		 Significance
VIX 27.42 Up
+.01		         
CVR II, VI		 8.4%
Below 		At
Extreme
VXN 43.39 Down -1.34          
CVR  VI		 5.77% Below Not
at Extreme

 

Abnormal Options Volume — This list
includes both percentage movers that are normally associated with an increase in
options activity, as well as stocks that have unusually high activity and / or
technical situations,
reflecting increased speculation of a potential price move.

Name Symbol Net
% Change		 Volume Avg.
Volume
Mercury
Interactive 
MERQ		       
+12%		 10061 2351
Cognizant Technology 
CTSH		        -7% 4436 1585
PeopleSoft
PSFT		       
+6%		 10696 4376
Tyco
TYC		       +4% 156897 35375

 

Stocks With Spikes in Implied
Volatility — Stocks with Increases and Decreases in implied
volatility compared to previous day. Candidates are then screened qualitatively.
These lists represent those issues that carry a blend of liquidity and/or
technical setups that might deserve further notice. 

Spike Up

Name Symbol IV Previous
IV		 High
IV		 Low
IV
WET
SEAL
WTSLA		 72.3 60.7 69.2 48.4

Spike Down

Name Symbol IV Previous
IV		 High
IV		 Low
IV
Hutchinson
Technology
HTCH		 47.5 53.7 76.6 49.4

 

Please use stops on every trade!