Wednesday’s Options Alerts
Lower consumer confidence knocked stocks down. The
market did battle back during the final hour of trading, but ended
slightly lower. The hope for follow through after Monday’s rally
quickly died after the release of the February consumer confidence number. The
index declined from 97.8 in January to 94.1, which was below the
expected 96.5. This was the first decline in the index in three months.
Strongest sectors today were retail, homebuilders, and biotechs, while weakest
were oils, semis, and broker dealers. For more information on today’s action,
please refer to today’s
Stock Market Recap.
The VIX
(
$VIX.X |
Quote |
Chart |
News |
PowerRating) opened and closed near
in the lower third of its range. This shift in intraday
sentiment suggests that fear is decreasing. No CVR signals were triggered today. The VXN
(
$VXN.X |
Quote |
Chart |
News |
PowerRating) showed similar action as the
VIX but it closed right on its lows.
This intraday shift in sentiment also suggests that fear is increasing. The VXN did not trigger any CVR
signals either. Both volatility dropped lower today as the indices rallied in
the face of the positive economic and corporate news. The drop in fear was more
evident in tech issues as they have been pummeled over the last week.
Points of Significance:
Shares of McAfee.com
(
MCAF |
Quote |
Chart |
News |
PowerRating)
jumped over 17% on triple its average volume today. No specific news was
announced but the shares are starting to bounce back from a very oversold
condition. Potential resistance comes in at its .382 retracement level at 15.05.
There is heavy activity in the June 15 calls.
Biotechs were strong today and Sepracor
(
SEPR |
Quote |
Chart |
News |
PowerRating) was no exception. Shares of the pharmaceutical company
jumped 8% on heavy volume today. However the shares did close below its
200-day moving average and its .382 retracement level. There is heavy activity
in the March 35 and 40 puts.
J.C. Penney
(
JCP |
Quote |
Chart |
News |
PowerRating) gained 4.64% today
on below-average volume. Despite the strength of retail sector in recent times,
J.C. Penny has been the weak sister. The shares are also bouncing back from an
oversold conditions. There is heavy activity in the March 20 and 25 puts.
| Volatility Index |
Close | Net Change |
Signals/Direction | % Above/Below 10 Day Moving Average |
Significance |
| VIX | 23.57 | UP .29 |
NONE | 2.07 % Below |
Not at Extreme |
| VXN | 44.82 | UP .75 |
NONE | 1.62 % 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 |
| McAfee.com | MCAF | + 17.21 |
2796 | 537 |
| Sepracor | SEPR | + 7.97 |
8883 | 1987 |
| Whirlpool | WHR | + 7.54 |
6395 | 3082 |
| Stanley Works |
SWK | + 6.14 |
506 | 136 |
| Goodyear Tire |
GT | + 6.09 |
3128 | 1398 |
| J.C. Penny |
JCP | + 4.64 |
11692 | 5676 |
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 |
| Maytag | MYG | 36.8 | 30.3 | 42 | 28.6 |
| Thoratec Labs. |
THOR | 75.8 | 62.8 | 83.2 | 49.6 |
| Cemex | CX | 31.7 | 27.7 | 35.2 | 27.1 |
| MTR Gaming |
MNTG | 56.5 | 50.8 | 62.8 | 47.8 |
| Providnet Healthcare |
PRHC | 51.8 | 47.1 | 55.9 | 45.4 |
| CSX Corp. |
CSX | 74.5 | 67.3 | 84.7 | 38 |
Spike Down
| Name | Symbol | IV | Previous IV |
High IV |
Low IV |
| Hotel Reservations |
ROOM | 63 | 100.9 | 75 | 56.5 |
| Affiliated Computer Systems |
ACS | 37.6 | 58.7 | 45.2 | 31.3 |
| Energy Sector SPDRs |
XLE | 19.3 | 26.1 | 32.7 | 21.7 |
| Charter One Financial |
CF | 17.8 | 23.8 | 36.4 | 23 |
| Dal-Tile | DTL | 22.6 | 28.5 | 33.3 | 27.1 |
| Smurffit-Stone | SSCC | 27.4 | 33.9 | 69.1 | 33.4 |
Please use stops on every trade!