Wednesday’s Options Alerts
As many expected, the Fed left rates unchanged. The markets drifted slightly
higher into the announcement, but gave back some of the gains following the
announcement. The Fed left the Fed Funds rate at the 40 year low of 1.75% as the
economic expansion is under way.
However economists believe that rate increases could begin in late
spring or early summer. For more information on today’s action, please refer to
the market
recap.
The VIX
(
$VIX.X |
Quote |
Chart |
News |
PowerRating)
opened near its high and closed near the lows of the day. This shift in
intraday sentiment again suggests that fear is dropping. No CVR signals were triggered today.
But once again the VIX does suggests that the market is overbought and we are
close to a CVR II sell signal. Add to this is the fact that the VIX is near an
eight month low could suggest a pullback of sorts could be near. The VXN
(
$VXN.X |
Quote |
Chart |
News |
PowerRating) opened
near its highs and closed near the midpoint of its range. This shift in intraday sentiment also
suggest that fear is dropping. The VXN triggered a CVR II sell signal.Â
Points of Significance:
Gemstar International
(
GMST |
Quote |
Chart |
News |
PowerRating)
plunged over 26% on seven times its average trading volume. The stock dropped to
a new 52 week low on the news a disappointing forecast along with the departure
of one of its top executives. The company expects a 10% – 15% decline in
licensing revenues from its onscreen cable and satelliete television programming
guides. In addition, Gemstar expects to take a $5 billion charge for goodwill.
There is heavy activity in the April 17.50, 20, and 22.50 calls.Â
Discount retailer Dollar General
(
DG |
Quote |
Chart |
News |
PowerRating)
gained 10% on over double its average volume. The shares gapped up and broke
above its 200-day moving average after the company reported earnings that beat
estimates by six cents. The company also forcasted earnings growth of 13 –
15%.Â
Accenture
(
ACN |
Quote |
Chart |
News |
PowerRating) dropped 11% on
over five times its average volume. The stock came under pressure today as it
expects to take a $212 million charge for bad investments. In addition, the
company will offer 89.8 million shares of stock.Â
| Volatility Index |
Close | Net Change |
Signals/Direction | % Above/Below 10 Day Moving Average |
Significance |
| VIX | 20.35 | DOWN 0.40 |
NONE | 5.35% Below | Not at Extreme |
| VXN | 38.99 | UP 0.24 |
CVR II SELL |
6.45 % Below |
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 |
| Gemstar TV Guide |
GMST | – 26.18 |
51837 | 6852 |
| Accenture | ACN | – 11.62 |
4138 | 1847 |
| Dollar General |
DG | + 10.54 |
1029 | 468 |
| Swift Transportation |
SWFT | – 4.86 |
1230 | 171 |
| Univision Communications |
UVN | – 4.73 |
26512 | 2969 |
| Tech Data |
TECD | – 4.30 |
1163 | 489 |
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 |
| Petroleo Brasileiro |
PBR | 47.5 | 35.8 | 45.1 | 37.2 |
| American Electric Power |
AEP | 20.4 | 16.6 | 30.6 | 17.4 |
| United Rentals |
URI | 47.2 | 39.6 | 74.2 | 39.8 |
| Swift Transporation |
SWFT | 55.1 | 46.4 | 63.6 | 41.9 |
| Amdocs Limited |
DOX | 73.2 | 65.4 | 71.6 | 49.2 |
| Mid Atlantic Med. Services |
MME | 42.6 | 38.3 | 52.2 | 34.7 |
Spike Down
| Name | Symbol | IV | Previous IV |
High IV |
Low IV |
| Imperial Chemical |
ICI | 41.6 | 52.6 | 106.1 | 34.5 |
| Hispanic Broadcasting |
HSP | 37.6 | 45.6 | 73.6 | 43.5 |
| Olin | OLN | 29.6 | 35.4 | 53.2 | 29.5 |
| Cendant | CD | 31.9 | 37.5 | 73.4 | 34.9 |
| ImClone Systems |
IMCL | 70.5 | 82.4 | 132 | 45 |
| Daimler Chrysler |
DCX | 29.2 | 33.9 | 55.3 | 31.7 |
Please use stops on every trade!