Thursday’s Options Alerts
Weakness from drugs
and financials,
along with a “sluggish” Beige Book
report, could not hold the major averages down, as stocks recovered from an
early sell off and ended in the green. Drugs
came under pressure over concerns of generic competition, while financials were
weak as a Wall Street Journal reported the Citigroup’s CEO, Sandy Weill, will
testify before regulators in the probe against the company’s investment banking
practices. Shares of Citigroup ended only four cents lower after being down
as much as 2.13.
At the
close, the Dow
(
$INDU |
Quote |
Chart |
News |
PowerRating) turned a 150-point loss into a gain of 44.11 points or
0.52%. The S&P
(
$SPX.X |
Quote |
Chart |
News |
PowerRating) gained 5.98 points or 0.67% and, the Nasdaq
(
$COMPX |
Quote |
Chart |
News |
PowerRating) gained 27.44 points or 2.12%. The Naz displayed some outperformance
despite some early weakness from KLA-Tencor
(
KLAC |
Quote |
Chart |
News |
PowerRating). Most tech related
sectors such as disk drives
(
$DDX.X |
Quote |
Chart |
News |
PowerRating) up 10.10%, semiconductors
(
$SOX.X |
Quote |
Chart |
News |
PowerRating)
up 7.84%, and oil services
(
$OSX.X |
Quote |
Chart |
News |
PowerRating) up 3.51% were the best performing
sectors today.
Meanwhile, the wost-performing sectors were: gold
(
XAU.X |
Quote |
Chart |
News |
PowerRating) down 2.85%, pharmaceuticals
(
$DRG.X |
Quote |
Chart |
News |
PowerRating) down
1.70%, chemicals
(
$CEX.X |
Quote |
Chart |
News |
PowerRating) down 1.13%, and healthcare
(
$HCX.X |
Quote |
Chart |
News |
PowerRating) down
0.87%. Initial jobless claims and the Treasury budget for September will be out
tomorrow. Despite the overbought condition, don’t fight the tape, but stand
close to the exit.
The VIX
(
$VIX.X |
Quote |
Chart |
News |
PowerRating) gapped up, opened near its highs, and closed
near its low. This shift in intraday sentiment shows a drop in fear.
The VIX triggered a CVR 1 buy. The VXN
(
$VXN.X |
Quote |
Chart |
News |
PowerRating) opened near its highs and closed near the lows of
day. This shift
in intraday sentiment also shows a drop in fear. The VXN didn’t
trigger any CVRs today.
Points of Significance:
| Volatility Index |
Close | Net Change |
Signals/Direction | % Above/Below 10 Day Moving Average |
Significance |
| VIX | 39.38 | UP 0.04 | CVR 1 BUY |
4.32% Below | Not At Extreme |
| VXN | 52.37 | DOWN 1.24 | NONE | 6.57% 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 |
| Echostar Communications |
DISH |
+ 10.62 | 4038 | 1327 |
| Photon Dynamics |
PHTN |
– 9.68 | 914 |
135 |
| Boston Scientific | BSX |
+ 5.82 | 10587 | 2018 |
| Applied Biosystems Corp. |
ABI |
+ 5.41 | 1953 | 211 |
| Prepaid Legal Services | PPD |
– 3.24 | 10462 | 1782 |
| Fleetboston Financial |
FBF |
+ 1.47 | 19915 | 4081 |
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 |
|
Donnelley & Sons
|
DNY |
41.5 | 29.4 | 36.9 | 21.2 |
| Household International | HI |
84.2 | 68.7 | 88.7 | 39.3 |
| Tupperware | TUP |
48.5 | 43.1 | 46 | 21.2 |
| Education Management | EDMC |
48.8 | 42.3 | 45.9 | 36.8 |
| America Online |
AOL |
69.8 | 62.6 | 93.2 | 45.7 |
| Dollar Tree Stores | DLTR |
75.6 | 68.7 | 70.6 | 38.3 |
Spike Down
| Name | Symbol | IV | Previous IV |
High IV |
Low IV |
|
PEC Solutions
|
PECS |
61.9 | 74.6 | 84.2 | 65 |
| Websense | WBSN |
78.5 | 91.9 | 124.9 | 64.6 |
| Alaska Air | ALK |
65.1 | 75.8 | 76.7 | 32.9 |
| Coach | COH |
56.4 | 66.2 | 77.2 | 40.6 |
| ChoicePoint | CPS |
50.9 | 59.1 | 53.3 | 27.8 |
| Hotels.com | ROOM |
55.9 | 64.6 | 71.4 | 50.6 |
Please use stops on every trade!