Monday’s Options Alerts
The markets put
in a mixed performance today as Blue Chips rallied while tech stocks
gave back some of their gains. Tech stocks were hit early
on as Gateway
(
GTW |
Quote |
Chart |
News |
PowerRating), JDS Uniphase
(
JDSU |
Quote |
Chart |
News |
PowerRating), PeopleSoft
(
PSFT |
Quote |
Chart |
News |
PowerRating),
and BMC Software
(
BMC |
Quote |
Chart |
News |
PowerRating) had cautious comments after reporting
earnings. However, positive news from Compaq Computer helped lift the
techs off their lows. For more
information on today’s action, please refer to the market
recap. The VIX
(
$VIX.X |
Quote |
Chart |
News |
PowerRating) opened near its highs and closed
near the lows of the day. This shift in intra-day sentiment suggests
that fear is still continuing to decline. No CVR signals were
triggered today, however, the VIX is slightly oversold which means
that the market is beginning to get overbought. The VXN
(
$VXN.X |
Quote |
Chart |
News |
PowerRating)
exhibited the same behavior as the VIX today. This shift in intra-day
sentiment also suggests that fear is declining. The VXN did not
trigger any CVR signals today, but it is approaching oversold levels.
Investor fear is continuing to fall after computer giant Compaq
Computer said that it expects a second-half recovery for the computer
industry.
Points of Significance:
Georgia Pacific
(
GP |
Quote |
Chart |
News |
PowerRating) jumped 13% on
almost triple its average volume. The shares are approaching potential
resistance near their .382 retracement level from the December high
and the 20-day moving average. The company reported fourth quarter
earnings that were in line with expectations. However, the real kicker
today was speculation that the government will step in to limit
liability stemming from asbestos lawsuits. There is heavy activity in
the following options February 25 and 27.5 calls, March 25 calls,
April 25 calls, February 25 puts, April 20 and 35 puts.
Microsemi
(
MSCC |
Quote |
Chart |
News |
PowerRating) dropped 11% on
four times its average volume. Shares of Microsemi are at a seven-
month low. The company reported first quarter earnings that matched
expectations. Microsemi also announced that they will be closing a
plant in Watertown, Massachusetts. In addition the company expects
their second quarter earnings to be between three to seven percent
below first quarter. However, they are optimistic about their third
quarter. There is heavy activity in
the February 20 calls.
Implied volatility for J.C. Penny
(
JCP |
Quote |
Chart |
News |
PowerRating)
is getting high; look for possible short volatilities such as short
straddles and strangles.
| Volatility Index |
Close | Net Change |
Signals/Direction | % Above/Below 10 Day Moving Average |
Significance |
| VIX | 21.93 | DOWN 0.84 |
NONE | 8.7 % Below |
Not At Extreme |
| VXN | 45.67 | DOWN 1.70 |
NONE | 5.37 % 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 |
| Georgia Pacific |
GP | + 13.56 | 28893 | 9369 |
| Dollar Tree Stores |
DLTR | + 12.80 |
1824 | 424 |
| McData Corp. |
MCDT | – 11.54 | 15598 | 1791 |
| Microsemi | MSCC | – 11.17 |
1365 | 504 |
| Sanmina | SANM | – 10.18 | 21173 | 3468 |
| Optimal Robotics |
OPMR | – 9.44 |
919 | 297 |
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 |
| Felcor Lodging |
FCH | 28.9 | 21.9 | 59.4 | 21.7 |
| J.C. Penny |
JCP | 79.2 | 62.5 | 61.9 | 45.5 |
| ImClone Systems |
IMCL | 145.5 | 119.1 | 86.7 | 45 |
| Cinergy | CIN | 27.8 | 23.1 | 31.7 | 25.2 |
| Furniture Brands |
FBN | 53.8 | 45.9 | 53 | 35.3 |
| RAS Security |
RSAS | 86.7 | 74.8 | 118.7 | 70.6 |
Spike Down
| Name | Symbol | IV | Previous IV |
High IV |
Low IV |
| Industrial Sector SPDRs |
XLI | 24.9 | 40.6 | 42.3 | 20.1 |
| Willamete Industries |
WLL | 6.6 | 9.7 | 59.6 | 19.3 |
| Dal-Tile | DTL | 23.1 | 31.1 | 33.3 | 27.1 |
| Winn Dixie |
WIN | 44.2 | 55.4 | 64.5 | 33.2 |
| Dominion Resources |
D | 19.8 | 24.2 | 30.8 | 21.7 |
| Telecorp PCS |
TLCP | 45.4 | 54.7 | 63.2 | 49.3 |
Please use stops on every trade!