Thursday’s Options Alerts
After the
turnaround yesterday, the
markets showed no follow thorough and once again dug deeper into multi-year
lows. Downgrades and earnings cuts on blue-chip giants General Electric
(
GE |
Quote |
Chart |
News |
PowerRating),
Johnson & Johnson
(
JNJ |
Quote |
Chart |
News |
PowerRating), General Motors
(
GM |
Quote |
Chart |
News |
PowerRating), and Merrill Lynch
(
MER |
Quote |
Chart |
News |
PowerRating)
kept the Dow and S&P down. The Nasdaq fared better for most of the session,
thanks to a rebound in Cisco Systems and chip stocks, but it wasn’t to be, as
the Naz also succumbed to the selling.
At the close, the Dow
(
$INDU |
Quote |
Chart |
News |
PowerRating) dropped
215.22 points or 2.86%. The index is approaching its 100% projection of the
prior down leg from early July at 7199. The S&P
(
$SPX.X |
Quote |
Chart |
News |
PowerRating) dropped 21.78
points or 2.72%, the index got within a hair of its July 24 low at 775.68.
Finally, the Nasdaq
(
$COMPX |
Quote |
Chart |
News |
PowerRating) fell 15.06 points or 1.33%.
Internets
(
$INX.X |
Quote |
Chart |
News |
PowerRating) up 0.93% and software
(
$GSO.X |
Quote |
Chart |
News |
PowerRating) were among the
only sectors in the green today. Airlines
(
$XAL.X |
Quote |
Chart |
News |
PowerRating) down 9.18, utilities
(
$UTY.X |
Quote |
Chart |
News |
PowerRating) down 9.14%, paper [$FPP.X|%FPP.X] down 5.50%, banks [$BKX.X$BKX.X]
down 4.29%, and retail
(
$RLX.X |
Quote |
Chart |
News |
PowerRating) down 4.25% were the weakest sectors
today. The inability of the retailers to show some kind of follow through after
yesterday’s end to the West Coast port lockout was definitely negative.
The VIX
(
$VIX.X |
Quote |
Chart |
News |
PowerRating) gapped up, opened near its highs, and closed slightly
above its open. This shift in intraday sentiment shows a rise in fear.
Today’s action triggered once again triggered
CVR
3 and 6 buy signals. The VXN
(
$VXN.X |
Quote |
Chart |
News |
PowerRating)
gapped up, opened on its highs and closed near the midpoint of its range. This
shift in intraday sentiment shows a drop in fear. Fear is rising and
capitulation could be near.
Points of Significance:
Volatility Index |
Close |
Net Change |
Signals/Direction |
% Above/Below 10 Day Moving Average |
Significance |
VIX |
49.48 | UP 3.02 | CVR 3 & 6 Buy |
10.42% Above | At Extreme |
VXN |
62.38 | UP 1.22 | NONE |
4.84% Above | 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 |
| American Electric Power |
AEP |
– 22.78 | 5591 | 989 |
| Household International | HI |
– 10.94 | 8621 | 1760 |
| Sears | S |
– 10.48 | 12639 | 5326 |
| Affiliated Computer Services | ACS |
– 8.80 | 12866 | 1069 |
| Harrah’s Entertainment |
HET |
– 8.21 | 1422 | 503 |
| Southern Co. | SO |
– 7.05 | 10258 | 1591 |
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 |
|
Harmon Industries
|
HAR |
68.1 | 49.2 | 52.1 | 29.6 |
| First Energy | FE |
60.3 | 44.6 | 42.8 | 20.7 |
| Worthington Industries |
WOR |
53.3 | 40.3 | 41.3 | 29.7 |
| Kroll | KROL |
100.2 | 76.4 | 69 | 40.7 |
| Consoliated Edision |
ED |
33.2 | 25.6 | 31.2 | 14.8 |
| Detroit Edision |
DTE |
40.2 | 31.7 | 33.8 | 16.8 |
| H&R Block | HRB |
73.9 | 59.4 | 62.2 | 32 |
| Cinergy | CIN |
48.4 | 39.3 | 59.1 | 16.5 |
| MBIA | MBI |
62.4 | 51.6 | 49.1 | 24.2 |
| Harrah’s Entertainment |
HET |
47.1 | 39.2 | 47.6 | 27.5 |
Spike Down
Name |
Symbol |
IV |
Previous IV |
High IV |
Low IV |
|
Fossil
|
FOSL |
64.5 | 118 | 60.5 | 36.8 |
Please use stops on every trade!