Monday’s Options Alerts

• February 1, 2002
• TradingMarkets Editors

The major market averages
ended slightly in the red today after two days of big gains. The release of the
employment report and the Supply Management index sent mixed signals about
the direction of the economy. For more information
on today’s action, please
refer to the market
recap. The VIX
(
$VIX.X |
Quote |
Chart |
News |
PowerRating) opened in the lower half of its range and closed
just under the open. There was no significant shift in intraday sentiment.. No CVR signals were triggered today.
The VXN
(
$VXN.X |
Quote |
Chart |
News |
PowerRating) once showed similar
action as the VIX. There was also no significant shift in intraday sentiment. The VXN did not trigger any CVR
signals. Continue to take caution as the VXN is still at precariously low
levels.

Points of Significance:

Waste Management
(
WMI |
Quote |
Chart |
News |
PowerRating), the nation’s largest
trash mover, got wasted today on over 11 times its average volume. The company
warned that their fourth quarter earnings will be in the neighborhood of 30 to
31 cents versus the consensus estimates of 34 cents. Waste Management lowered
their estimates due to credit exposure with Enron. The company will release
results on February 26. In addition, the company has also announced a $1
billion share buy back program which will begin after the company reports their
fourth quarter results. There is heavy activity in the February 25
calls, April 25 calls, April 27.5 calls, as well as the February 25 and 27.50
puts.

Shares of TMP Worldwide
(
TMPW |
Quote |
Chart |
News |
PowerRating) dropped 10% on
over 12 times average volume. The latest issue of Forbes magazine published
an article that criticized the company’s accounting practices. The article noted
that TMP incurred a lot of one-time merger and integration expenses, which makes
their results look better. The stock also appears to be breaking down from a
sideways head & shoulders top. There is heavy activity in the February and
March 30, 35, and 40 puts as well as March 40 calls.

One day after they raised their fourth quarter
outlook and announced a secondary offering, Alloy Inc.
(
ALOY |
Quote |
Chart |
News |
PowerRating), gave back
all of yesterday’s gains and more. The stock pulled back after hitting
resistance at its downward trendline. There is heavy activity in the February 55 calls and June
50 puts.

Abnormal Options Volume With Price Movement
— Abnormal options volume (calls and puts) with stock price movement

Stocks With Biggest Spikes in Implied
Volatility — Stocks with biggest increases or decreases in implied
volatility compared to previous day

Spike Up

Spike Down

Please use stops on every trade!