Wednesday’s Options Alerts…
Stocks put in a strong performance after
a better-than-expected retail sales report. However, the major averages sold off,
only to reverse again to end up in the green. For more information
on today’s action, please
refer to the market
recap. The VIX
(
$VIX.X |
Quote |
Chart |
News |
PowerRating) opened in the upper half of its range and closed
near the lows of the day.
This intra-day shift in sentiment
suggests that fear is decreasing. Today’s action triggered a CVR
II buy signal. The VXN
(
$VXN.X |
Quote |
Chart |
News |
PowerRating)
opened near the mid-point of its range and closed near the lows of the day. This intra-day shift in sentiment also
suggests that fear is decreasing. The VXN did not trigger any signals today.
Points of Significance:
Check Point Software
(
CHKP |
Quote |
Chart |
News |
PowerRating) dropped over
12% on four times its average volume. The company
announced fourth quarter earnings that beat Wall Street expectations, but warned
that its first quarter 2002 earnings will be “flat or maybe slightly down.”
Its shares are approaching their .382 retracement level from their September low to
the January 9 high at 37.87. Its implied volatility is somewhat low,
making option purchases suitable.
Shares of Dollar General
(
DG |
Quote |
Chart |
News |
PowerRating) dropped 12% on
over seven times their average
volume. While already being under investigation by the SEC, the company
announced that earnings for fiscal 1998 to 2000 will be restated. The shares did
bounce off their .618 retracement level from its September lows.
Black Box Corp.
(
BBOX |
Quote |
Chart |
News |
PowerRating) jumped 10% on four times its average volume.
The company reported third quarter earnings that beat analysts’ expectation by
four cents. Its implied volatility is somewhat low.
Aeroflex Inc.
(
ARXX |
Quote |
Chart |
News |
PowerRating) dropped almost 10%
today on double its average volume. No specific news was cited. The stock did
break below its uptrend line from its September lows. Its implied volatility is
low; look for possible put purchases.
| Volatility Index |
Close | Net Change |
Signals/Direction | % Above/Below 10 Day Moving Average |
Significance |
| VIX | 24.42 | DOWN 0.60 |
CVR II BUY |
4.72 % Above |
Not At Extreme |
| VXN | 48.02 | DOWN 1.49 |
NONE | 0.00 % 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 |
| Check Point Software | CHKP | – 12.92 | 32025 | 8009 |
| Dollar General |
DG | – 12.8 | 5635 | 1365 |
| CACI Int’l | CACI | – 11.43 | 1970 | 585 |
| Black Box |
BBOX | + 10.10 | 2280 | 218 |
| Aeroflex Inc. | ARXX | – 9.78 | 675 | 198 |
| Numerical Technologies |
NMTC | – 9.09 | 2026 | 427 |
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 |
| SPX Corp | SPW | 52.5 | 37.3 | 58.5 | 34.6 |
| ARM Holdings |
ARMHY | 74.5 | 95.7 | 80.3 | 67 |
| Entergis | ENTG | 70.1 | 58.9 | 72.4 | 60 |
| Intersil Holdings |
ISIL | 92.8 | 78.7 | 111.2 | 73.1 |
| CACI International | CACI | 68.7 | 59.2 | 67.3 | 48.9 |
| Enzon | ENZN | 65.4 | 58.6 | 85.7 | 54.8 |
Spike Down
| Name | Symbol | IV | Previous IV |
High IV |
Low IV |
| Niagara Mohawk | NMK | 14.8 | 26 | 36.2 | 21.6 |
| BB&T | BBT | 74.5 | 95.7 | 80.3 | 67 |
| Chevron Texaco |
CVX | 17.7 | 21.5 | 28.3 | 20.1 |
| Alpharma | ALO | 51.3 | 58.5 | 58.8 | 43.9 |
| Chevron Texaco |
CVX | 17.7 | 21.5 | 28.3 | 20.1 |
| Huntington Bancshares |
HBAN | 28.4 | 33 | 38.3 | 23.6 |
| Citizens Communications |
CZN | 38 | 45.2 | 56.3 | 40.7 |
Please use stops on every trade!