Reading The Options
While it is a strategy with a little more risk than others, the TradersWire
options alerts can often tip off a major move in the underlying
stock.
10-03-2001
11:13:44
Options Alerts
Abnormal
Call Volume
- Newport News Shipbuilding (NNS);
NNS is testing its prior high out of a pullback. There are volume surges
taking place this morning across the October 65 and October and November 70
calls. NNS is up 0.20 to 67.55.
What we look for in this strategy is for the stock to be rising in the
short-term and higher than average option volume within calls either one strike
in the money or one strike out of the money. We only look at same month calls or
one month out for this approach. The idea is to attempt to spot those with
knowledge of news, such as a buyout, that will boost the underlying’s price,
trying to surreptitiously capitalize on the advance information.
The stock has slid a little, but was up over $5 early in the
day’s session.
This strategy contains some risk, but the rewards can be
handsome.
Until Monday,
Duke
P.S. I will not be doing a Live From TradersWire Friday, due to
my travel to Las Vegas for TM2001. I look forward to meeting several of you
there.