Order Flow Joins Dow In Duet Of Dearth

“How
much lower can we possibly go?”
was
the question bandied about on the elevator ride to the office today.
With the Nasdaq moving ever- southwards and the Dow hitting a new 52-week
low, this is a topical question indeed. “Not much lower, surely we have
bottomed out!” was the consensus among my fellow commuters. But I had to bite
my lip, because I think we could still see some falling-off. 

Options players
remain jittery on this Thursday morning, perhaps having failed to completely
recover from yesterday’s market plunge.  Traders
are in defensive mode, and continue to sell premium.
Call sellers are grabbing the lion’s share of paper this morning, and
they lead buyers nearly 2:1. Put buyers
are stomping their feet loudly as well, rattling off their bearish beat.
They lead sellers 3:2. Order flow
remains quite low, registering a .9 on a scale of 1.0 to 10.0, with 1.9 being
the new 30 day moving average. ( Note, there was an error in the column
yesterday: 
Our search engines are picking up some unusual activity in
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TXCC |
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and
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where call buyers outpaced sellers.
Also,
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put buyers are crushing sellers.

Let’s
take a look at our daily numbers..



Pre-open
order volume was very light today. In the overall market, call sellers led
buyers 2:1, and put buyers led sellers 3:2. 

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call sellers outpaced
buyers 3:1, while put sellers led buyers 2:1. 

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ORCL |
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call buyers topped
sellers 5:4, while put sellers trounced buyers 3:1. 

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JNPR |
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call sellers dominated
buyers 2:1.

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IBM |
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call sellers came out in force, leading buyers 3:1.
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LU |
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call sellers beat out buyers 5:1.
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TQNT |
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call buyers topped
sellers 2:1.
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MANU |
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put buyers stomped sellers 18:1.

First-hour
order volume remained very light today. In the overall market, call sellers led
buyers 2:1, and put buyers led sellers 3:2.
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INTC |
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call sellers outpaced buyers 5:1, while put sellers led buyers 2:1.
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AOL |
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call buyers topped sellers at almost 3:1, while put buyers
trounced sellers 11:1.
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SUNW |
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call
sellers dominated buyers  almost
3:1.
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IBM |
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call sellers came out in
force, leading buyers 2:1.
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AMAT |
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call sellers beat out buyers
18:1!!

Yesterday we
suggested that you take a look at the
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April 40/45/50 put butterfly,
which was trading for under a buck; and also the
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CIEN |
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April 40/45/50 put
butterfly, which could have been had for  $
¾.  How do they look this morning? 

Our engines show
the QCOM April 40/45/50 put butterfly is down, trading 
$3/8- $3/4, while the CIEN  April
40/45/50 put butter is trading $1-$1 ¼,  thus
up a quarter.

Some of you have
written in requesting more information on Butterflies and how to construct them. 
Given the nature of these markets, I have decided to devote an entire
lesson to them, which will come out in April. 
Also, be aware, that my upcoming Seminar in Chicago will thoroughly
stress Butterflies.  In the
meantime, I promise to answer all personal questions concerning these strategies
individually.

Keep
pumping me those questions: tonys@tradingmarkets.com