Monday’s Options Alerts…
Major market averages fell today as the government
reported that the unemployment rate increased from 5.3 percent in October to 5.7
percent in November. This increase marks a six-year high in the unemployment
rate. The major indices did come off their lows in the afternoon as the negative
unemployment report could be viewed a stimulus for the Fed to cut interest rates
again next Tuesday. The VIX
(
$VIX.X |
Quote |
Chart |
News |
PowerRating) opened near its high and closed in
the lower half of its range. Again, intra-day shift in sentiment
is telling us that fear is starting to creep back up. No CVR signals were
triggered today. The VXN
(
$VXN.X |
Quote |
Chart |
News |
PowerRating) opened in the lower third of its range and closed
near the half-way mark. This intra-day shift in sentiment is telling us that fear is
increasing as investors are beginning to take some profits from the tech stocks.
The VXN did not trigger any CVR signals.
Points of Significance:
Halliburton
(
HAL |
Quote |
Chart |
News |
PowerRating) dropped
over 42% on over 15 times its average trading volume today after a Baltimore
jury awarded $30 million to plaintiffs in an asbestos case against its
subsidiary, Dresser Industries. Verdicts against Halliburton in other states are
also mounting. Today’s drop marks a nine-year low for the stock. Option volume
was extremely heavy, as it traded over 15 times its average contract volume. In
addition, its implied volatility rocketed to a new high which makes its options
expensive. InVision Technologies
(
INVN |
Quote |
Chart |
News |
PowerRating) jumped almost 23% today as their
vice president, Frederick Muntz, testified before the U.S. House of
Representatives Subcommittee on Aviation. Mr. Muntz stated that the company is
making efforts to increase production capacity to meet the increasing
demand as needed. Its options traded over triple their average contract volume.
There is heavy activity in the December 30 and 35 calls. Shares of Integrated
Device Technology
(
IDTI |
Quote |
Chart |
News |
PowerRating) fell 17% on over six times its average trading
volume today, as they warned that third quarter revenues will be 15% to 20% lower
than the previous quarter due to dismal sales. Its options traded double their
average contract volume and there is heavy activity in the December 25 and 27.50
calls. Georgia Pacific
(
GP |
Quote |
Chart |
News |
PowerRating) dropped almost 14% today on over five times its
average trading volume as investors question their position on the asbestos
litigation liabilities. Its options traded over eight times its average contract
volume.
| Volatility Index |
Close | Net Change |
Signals/Direction | % Above/Below 10 Day Moving Average |
Significance |
| VIX | 24.89 | DOWN 0.21 | NONE | 3.04 % Under | Not At Extreme |
| VXN | 50.18 | UP 1.79 | NONE | 2.24 % Under |
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 |
| Halliburton | HAL | – 42.44 | 63052 | 4125 |
| Entrust Technologies | ENTU | + 23.29 | 420 | 202 |
| InVision Technologies | INVN | + 22.78 | 7233 | 2226 |
| Integrated Device Technologies |
IDTI | – 17.14 | 2973 | 1222 |
| Cooper Industries | CBE | – 14.88 | 23191 | 9798 |
| Georgia Pacific Group | GP | – 13.93 | 28611 | 3446 |
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 |
| Halliburton | HAL | 104.5 | 56.6 | 97.9 | 42.2 |
| Georgia Pacific | GP | 53.9 | 34.9 | 55.4 | 32.3 |
| Cooper Industries | CBE | 80.8 | 60.1 | 84.8 | 31.1 |
| McDermott Int’l | MDR | 99.8 | 75.5 | 99.9 | 66.6 |
| Willamette Ind. | WLL | 31.7 | 25.9 | 44.7 | 19.3 |
| PPG Industries | PPG | 26.9 | 22.4 | 35.5 | 25.3 |
Spike Down
| Name | Symbol | IV | Previous IV |
High IV |
Low IV |
| Dal-Tile International | DTL | 20.7 | 32 | 32.3 | 30.3 |
| Moody’s Corporation |
MCO | 26.4 | 34.4 | 30.7 | 25.7 |
| ServiceMaster | SVM | 20.2 | 25.4 | 37.7 | 21.5 |
| Constellation Brands |
STZ | 34.9 | 42.3 | 49.9 | 30.2 |
| Banco Bilbao Vizcaya |
BBV | 36.3 | 43.8 | 63 | 31 |
| Lyondell Chemical |
LYO | 45.6 | 53.4 | 58.7 | 39.4 |
Please use stops on every trade!