Gore Smiles, Shows Off Dimples
A unanimous ruling by the Florida Supreme Court Tuesday mandating the inclusion of
results from controversial hand recounts in the official final election tally infused the
Democrats with a huge surge of enthusiasm and energy, but knocked the market into a
precipitous drop. Options traders, regardless of their political affiliations, seemed more
interested in tomorrow’s turkey dinner, as early morning volume proved low. However,
for those options players who take this court ruling as the rudder that will stabilize
this market, we counsel restraint. Many legal maneuverings may still lie ahead, and the
market will continue to react to each edict with whiplash.
Pre-open order volume was extremely light today. In the overall market, call sellers
and buyers are even at 1:1, and put buyers are on a par with sellers at 1:1. No big
surprises in the top five order volume leaders today:
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CSCO |
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DELL |
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MSFT |
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INTC |
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LU |
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PowerRating). LU order flow was high, with the continuing reverberations of yesterday’s
report on a negative-earnings recalculation. MSFT call sellers outnumber buyers 3:1. In
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EMC |
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PowerRating), pre-bell-call sellers were out in force. CSCO put sellers made their presence felt as
well, leading buyers 5:1.
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MOT |
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After the first hour of trading, order volume has remained light. In the overall
market, call buys and sells were even at 1:1, and put buys and sells followed suit, at
1:1. Top volume leaders remained nearly the same:
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INTC |
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CSCO |
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LU |
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ORCL |
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QCOM |
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sellers lead buyers at a lop-sided 9:1 ratio.
(
AMAT |
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while put sellers predominate over put buyers.
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YHOO |
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KO |
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Market players are taking a breather today. Volume is very light, and consequently
volatility is low, despite the market’s drop and the unfolding of political events.
Expect Friday’s activity, with only a half day of trading going on, to be more of the
same, as traders decline to make large commitments until after the holiday. However,
Monday may see a return of higher volume and volatility, if the election wrangling
continues. So, again, we suggest sticking with lower-priced options, and refraining from
shorting “juicy” options to pick up premium, in order to avoid becoming the
turkey. Happy Thanksgiving to everyone!