Friday’s Options Alerts
Trading was choppy on this pre-holiday
session. A better-than-expected durable goods report and lower
initial jobless claims sparked an early morning rally, but that didn’t last too
long, however the averages made another dramatic turnaround to close near the
highs of the day. April durable goods rose 1.1%, beating the 0.8% rise that
economists were expecting. Excluding transportation, durables rose 2.9%. vs. consensus
expectations of 1%. Strongest sectors were biotechs, gold, airline, and select
Internet issues, while weakest sectors included drugs and semiconductors. For more information on today’s action, please refer to
the market
recap.
The VIX
(
$VIX.X |
Quote |
Chart |
News |
PowerRating) opened near
the top third of its range and closed near the lows of the day. This shift in intraday
sentiment again suggests a decrease in fear. No CVR signals were triggered
today. The VXN
(
$VXN.X |
Quote |
Chart |
News |
PowerRating) also opened near the top third of its range and close
near the lows of the day. Today’s action in the VXN triggered a CVR
I buy signal today.
Points of Significance:
Haliburton
(
HAL |
Quote |
Chart |
News |
PowerRating) jumped over 7% on
triple its average volume. The shares rose today after a cheery presentation
about the company’s new products/technologies, cost savings, and asbestos liabilities. Shares of Haliburton did break out of a three month base and rose
to a near six-month high. The stock does have resistance at its 200-day
moving average up ahead. Haliburton’s implied volatility is trading near a 50%
discount to its historical volatility.
Activitison
(
ATVI |
Quote |
Chart |
News |
PowerRating)
gained 7% on double its average volume. Activision shares broke out to a new 52
week high. The company announced yesterday that they purchased Z-Axis, maker of
Dave Mirra extreme sports series. However there is a negative divergence showing
on its MACD and RSI.
Biotech HOLDRs
(
BBH |
Quote |
Chart |
News |
PowerRating) rallied over
7% on over double its average volume. Biotech stock ran up on the news that
Biogen received FDA approval for its psoriasis drug, Amevive. However the BBH is
still clearly in a downtrend. There is also a confluence of resistance levels at
the 104.83 area. There is heavy activity in the July 95 puts.
| Volatility Index |
Close | Net Change |
Signals/Direction | % Above/Below 10 Day Moving Average |
Significance |
| VIX | 20.35 | DOWN 1.24 |
NONE | 7.58 % Below |
Not At Extreme |
| VXN | 43.20 | DOWN 1.50 |
CVR I BUY |
3.87 % Below |
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 |
| Medimmune | MEDI | + 12.82 |
3001 | 600 |
| Haliburton | HAL | + 7.77 |
21415 | 2445 |
| Biotech HOLDRs |
BBH | + 7.57 |
14283 | 3019 |
| 4Kids Entertainment |
KDE | – 7.18 |
659 | 223 |
| Activision | ATVI | + 7.10 |
520 | 174 |
| Amgen | AMGN | + 6.61 |
15884 | 7228 |
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 |
| Financial Sector SPDRs |
XLF | 24 | 18.4 | 26.3 | 13.6 |
| Pacific Centry Finance |
BOH | 26.3 | 22 | 32.1 | 25.5 |
| Nisource | NI | 36.5 | 30.7 | 31.5 | 22.7 |
| Glaxosmithkline | GSK | 26.3 | 23.2 | 28.8 | 21.1 |
| Coach Inc. |
COH | 50.8 | 44.9 | 56.3 | 40.6 |
| Allied Capital Corp. |
ALD | 51.4 | 46 | 41.1 | 21.5 |
Spike Down
| Name | Symbol | IV | Previous IV |
High IV |
Low IV |
| Merck | MRK | 17.9 | 22.6 | 30.9 | 21.2 |
| Biogen | BGEN | 56.4 | 69 | 61.7 | 35.8 |
| Basic Industries SPDRs |
XLB | 17.6 | 20.9 | 42 | 16.8 |
| Woolworth | Z | 43.7 | 51.1 | 54.4 | 39.6 |
| Reliant Energy |
REI | 64.5 | 74 | 71.6 | 28.1 |
| Allied Capital |
ALD | 51.4 | 46 | 41.1 | 21.5 |
Please use stops on every trade!