Call Selling Continues To Dominate
With
the New Year just around the corner, the big story here is that there
is no story. Whether you had a busy year trading or were casually involved, the
performance of the averages (Nasdaq, S&P, DJIA, Russell, etc.) in 2000 seems
to dominate the news today. But who buys (or sells) in January and then closes
out in December? None of us, I am certain. The
big news for options trades is break time.
Early this
morning, options players are witnessing another early bout of call selling, on
light to moderate volume. In the tech sector, however, put sellers are coming
out to play. Volatility remains fairly stable early on, having jumped up
slightly over a point yesterday. There are pockets of fleeting opportunity, but
I would resist until something obvious sets up. Here is how the numbers are
shaping up…
Pre-open
order volume was light this morning. Overall, call sellers led buyers at 2:1,
while put sellers and buyers were even at
1:1. Some of the usual tech titans lead in terms of order volume, with the top
five as follows: CSCO, INTC, MSFT, WCOM and IBM. In pre-bell activity, MSFT call
sellers outnumber buyers 3:1.yes”> 3:2. INTC call sellers
led buyers 3:2. DELL call sellers
dominate buyers 8:1. CIEN call buyers are crushing sellers 4:1. JDSU call
sellers outpace buyers 5:3.
First-hour
order volume remained light. Overall, call sellers led buyers at 3:2, while put
sellers led buyers 5:4. The top five are as follows: INTC, CSCO, JDSU,
QCOM and SUNW. In pre-bell activity, INTC call sellers dominated buyers
6:1. CSCO call sellers outnumber buyers
3:2. JDSU call buyers outpace sellers
3:2. SUNW call buyers outgun sellers at
nearly 3:1, while put sellers led buyers 3:2. MSFT
call sellers led buyers 2:1. SEBL call
buyers led sellers 3:2, while put buyers led sellers 2:1.
AOL put sellers led buyers 5:1.
So,
where have all the "players" gone? You can’t tell me that because
the national averages concluded a 12-month cycle with negative results the
interest in trading options has dissipated. Perhaps it is only the holiday week
(which is where I’m at), but if you fall into this category, then we have work
to do. We can make it with all three types of market movements…Up, Down and
Sideways… and really every gradation in between. The key is choosing the right
strategy, we’ll help you do just that. You can now mail me at tonys@tradingmarkets.com.