Friday’s Options Alerts
Oh boy, now that was
delicious. The ETFs today experienced a very powerful percentage rally giving
investors a preholiday feast. Volume was relatively strong, especially in
context to typical action before a major holiday. It seems “The Ducks”
were once again quacking and couldn’t stand the thought of not nibbling before
the big day.
The
(
SPY |
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News |
PowerRating)s and
(
DIA |
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PowerRating)s are now trading at
their best levels since the August highs. The
(
QQQ |
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PowerRating) and semiconductor HOLDR
(
SMH |
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News |
PowerRating), as the recent leaders in this rally, have already usurped that
barrier and are now busy trying to post higher highs in their newly established
uptrends.
The
volatility indices
(
$VXN |
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Chart |
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PowerRating) and
(
$VIX |
Quote |
Chart |
News |
PowerRating)
are acting about well as one could ask for, if you’re rooting for
Chicago…..the Bulls that is. In light of today’s gains, both indices are
trading well. Why do I say this? Currently, both indices are trading
above their August lows signaling that complacency, while maybe in the
passenger’s seat, has yet to take control of the wheel.
Interestingly, the VIX
had to put in a large percentage up move in order to get itself to these levels,
on a day that would normally associated with large decreases in this index
(remember, inverse relationship under normal market conditions). It should be
noted that this figure could be a bit “off” because of how implied
volatilities are calculated when there is a holiday involved, but nonetheless
strike one up for the bulls in this department.
One last point before we say
goodnight. Don’t forget these words of wisdom, especially when looking to gorge
oneself on a 20 lb. bird. I’ve said it once, and I’ll say it again, “Bulls
make money, Bears make money, but Pigs get slaughtered.” Have a great
holiday.
Points of Significance:
| Volatility Index |
Close | Net Change |
Signals/Direction | % Above/Below 10 Day Moving Average |
Significance |
| VIX | 30.83 | Up +2.09 |
No Signals |
4.51% Above |
Not at Extreme |
| VXN | 48 | Up +2.31 | No Signals |
2.58% Above | Not at Extreme |
Abnormal Options Volume — This list
includes both percentage movers that are normally associated with an increase in
options activity, as well as stocks that have unusually high activity,
reflecting increased speculation of a potential price move.
| Name | Symbol | Net % Change |
Volume | Avg. Volume |
| Boston Scientific |
BSX |
+7% |
9390 | 1613 |
| America Online | AOL |
+7% | 32791 | 13644 |
| Walgreen | WAG |
+1% | 9024 | 1947 |
Stocks With Spikes in Implied
Volatility — Stocks with Increases and Decreases in implied
volatility compared to previous day. Candidates are then screened qualitatively.
These lists represent those issues that carry a blend of liquidity and/or
technical setups that might deserve further notice.
Spike Up
None
Spike Down
| Name | Symbol | IV | Previous IV |
High IV |
Low IV |
| BB&T Corp |
BBT |
20.1 | 23.4 | 36.8 |
15.4 |
| PEC Solution |
PECS |
59.6 | 68 | 85 | 63.5 |
| CDW Computer Centers | CDWC |
48.7 | 55 | 68.5 | 44.1 |
Please use stops on every trade!