Tuesday’s Options Alerts
The early morning rally faded and stocks ended mixed ahead of tomorrow’s Fed
meeting. Following last week’s abundance of positive news on the economy,
stocks started the morning on a positive note but reversed by late morning.
Meanwhile biotechs continued to show strength and are on the verge of crossing
above its 200 day moving average. For more information on today’s action, please refer to
the market
recap.
The VIX
(
$VIX.X |
Quote |
Chart |
News |
PowerRating)
opened near the midpoint of its range and closed near the lows of the day. This shift in
intraday sentiment suggests that fear is still dropping. Today’s action triggered
a CVR
VI sell signal. We are also close to a CVR II sell. The VXN
(
$VXN.X |
Quote |
Chart |
News |
PowerRating) opened
near its highs and closed slightly below the mid point of its range. This shift in intraday sentiment also
suggest that fear is dropping. The VXN also triggered a CVR
VI sell signal.
Volatility once again dropped, the VIX is still on its July 2001 lows and
looking ready to surpass it. This of course is a sign of complacency, wait for
multiple signals before taking action.
Points of Significance:
Brocade Communications
(
BRCD |
Quote |
Chart |
News |
PowerRating)
dropped 10% on double its average volume. Brocade and other data storage issues
have been weak due to concerns over growth. The shares have almost retraced 100%
of its prior up leg. There is heavy activity in the April 22.50 puts.
Alexion Pharmaceuticals
(
ALXN |
Quote |
Chart |
News |
PowerRating)
gained 5.5% on double its average volume. The shares are breaking out after
completed a double bottom. There is heavy activity in the April 25 calls.
Shares of discount hotel accommodations
provider Hotel Reservations
(
ROOM |
Quote |
Chart |
News |
PowerRating) jumped almost 6% today on triple its
average volume. The company announced today that Hilton
(
HLT |
Quote |
Chart |
News |
PowerRating) will now be
in its distribution network. The shares are in a beautiful uptrend and are at a
new 52 week high.Â
| Volatility Index |
Close | Net Change |
Signals/Direction | % Above/Below 10 Day Moving Average |
Significance |
| VIX | 20.75 | DOWN .02 |
CVR VI SELL |
4.33% Below | Not at Extreme |
| VXN | 38.75 | DOWN 1.51 |
CVR VI SELL |
7.85 % 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 |
| Brocade Communications |
BRCD | – 9.55 |
29973 | 12587 |
| Polymedica | PLMD | – 9.05 |
1948 | 664 |
| Alexion Pharmaceuticals |
ALXN | + 5.55 |
328 | 116 |
| Hotel Reservations |
ROOM | + 5.95 |
1656 | 373 |
| Travelocity.com | TVLY | + 3.97 |
3094 | 1303 |
| Genetech | DNA | + 3.61 |
6664 | 2171 |
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 |
| Lear | LEA | 38.2 | 33.9 | 53 | 30.3 |
| Corporate Executive Board |
EXBD | 56.8 | 50.6 | 74.8 | 49.4 |
| Viropharma | VPHM | 155.3 | 139.5 | 131.1 | 64.3 |
| Spanish Broadcasting |
SBSA | 64.6 | 58.4 | 81.3 | 49.6 |
| Puget Sound Energy |
PSD | 25.1 | 22.7 | 28.7 | 22.3 |
| Daimler Chrysler |
DCX | 32.1 | 29.1 | 55.3 | 31.7 |
Spike Down
| Name | Symbol | IV | Previous IV |
High IV |
Low IV |
| Consumer Staple SPDRs |
XLP | 6.4 | 15.4 | 25 | 12.6 |
| Imperial Chemicals |
ICI | 53.3 | 53.3 | 106.1 | 34.5 |
| DQE Inc. |
DQE | 23 | 27.3 | 34.5 | 26.3 |
| Dial Corp. |
DL | 29 | 34.4 | 41.7 | 31.5 |
| Reliant Resources |
RRI | 58.7 | 68.9 | 94 | 60.7 |
| Williams Companies |
WMB | 41.1 | 47.7 | 84.7 | 43.3 |
Please use stops on every trade!