Monday’s Options Alerts
Negative economic
data took down the averages once again. Warnings
from National Semiconductor
(
NSM |
Quote |
Chart |
News |
PowerRating) and Walt Disney also helped contributed to
the sell-off. What started out as a promising week has turned into anything but
— as a barrage of negative economic data from lower consumer sentiment to
lower GDP numbers knocked the major averages down this week.
At
the close, the Dow
(
$INDU |
Quote |
Chart |
News |
PowerRating) fell 193 points or 2.27% after it had
been down over 300 points earlier in the day. For the week, the Dow gained just
50 points or 0.005%. The S&P 500
(
$SPX.X |
Quote |
Chart |
News |
PowerRating) dropped 20 points or 2.30%
and for the week the index gained just 11 points or 1.3%. The Nasdaq
(
$COMPX |
Quote |
Chart |
News |
PowerRating)
was the weakest index as it
dropped 32 points or 2.5%, for week, the Nasdaq lost 14 points or 1.13%.
Best-performing sectors today were gold
(
$XAU.X |
Quote |
Chart |
News |
PowerRating), drugs
(
$DRG.X |
Quote |
Chart |
News |
PowerRating), and
health care issues
(
$RXP.X |
Quote |
Chart |
News |
PowerRating). Weakest sectors were airliners
(
$XAL.X |
Quote |
Chart |
News |
PowerRating),
chemicals
(
$CEX.X |
Quote |
Chart |
News |
PowerRating), and oil service issues
(
$OSX.X |
Quote |
Chart |
News |
PowerRating). On the
economic front, July nonfarm payrolls came in much weaker than expected as it
only rose by 6,000 while economists were expecting a rise of 80,000. The
unemployment rate held steady at 5.9%. Personal income rose 0.6% beating
estimates of 0.4%, while personal consumption rose by 0.5% or slightly less than
the 0.6% increase that was expected.
Volatility again spiked higher today. The VIX
(
$VIX.X |
Quote |
Chart |
News |
PowerRating)
had a wide 7 point range today as gapped
up, opened near
its lows, and closed near the midpoint of its range. Although off its highs,
this shift
in intraday sentiment again shows a jump in fear. Once again, no more CVRs were
triggered today. The VXN
(
$VXN.X |
Quote |
Chart |
News |
PowerRating) also gapped up, opened near in the
lower third of its range
and closed near the highs of the day. This shift
in intraday sentiment shows an increase in fear. The VXN didn’t trigger any
CVRs either.
Points of Significance:
Delta Airlines
(
DAL |
Quote |
Chart |
News |
PowerRating) fell 10.6% on about average
volume. Airliners took it on the chin today as fears of traveling during the
September 11 surfaced.
| Volatility Index |
Close | Net Change |
Signals/Direction | % Above/Below 10 Day Moving Average |
Significance |
| VIX | 45.39 | UP 3.90 | NONE | 8.04 % Above |
Not at Extreme |
| VXN | 65.44 | UP 5.09 | NONE |
3.95% Above | Not at Extreme |
Abnormal Options Volume With Price Movement
—
Abnormal options volume (calls and puts) with stock price movement
| Name | Symbol | Net % Change |
Volume | Avg. Volume |
| Delta Airlines | DAL |
– 10.61 | 2773 | 573 |
| Family Dollar Stores | FDO |
– 10.70 | 759 | 102 |
| Walt Disney | DIS |
– 9.03 | 16202 | 3505 |
| Royal Caribbean Cruise | RCL |
– 7.79 | 755 | 239 |
| Maxim Integrated Products | MXIM |
– 7.84 | 14503 | 5192 |
| Transocean |
RIG |
– 7.05 | 1060 | 169 |
Stocks With Biggest Spikes in Implied
Volatility — Stocks with biggest increases or decreases in implied
volatility compared to previous day
Spike Up
| Name | Symbol | IV | Previous IV |
High IV |
Low IV |
| Cendant | CD |
90.4 | 64.2 | 77.1 | 33.5 |
| Hospitality Properties | HPT |
30.5 | 23.3 | 29.2 | 16.2 |
| Washington Fed S&L | WFSL |
29.6 | 23.5 | 32.5 | 21.9 |
| Ecolab | ECL |
47.7 | 38.1 | 3939 | 22.5 |
| American Medical Systems | AMMD |
67.6 | 54.9 | 64.6 | 41.8 |
| Lear | LEA |
52.9 | 43.3 | 47.1 | 30.1 |
Spike Down
| Name | Symbol | IV | Previous IV |
High IV |
Low IV |
| TCF Financial Corp. | TCB |
25.9 | 30 | 35.4 | 19.1 |
Please use stops on every trade!