Thursday’s Options Alerts
Following
yesterday’s plunge, the indices traded in a very choppy fashion. However, a final-hour rally helped pushed the averages to modest gains. Although
volume was on the light side, breadth was positive. Economic news didn’t help
the averages today. After falling 1.7% in June, construction spending in July
came in flat, while expectations called for a 0.50% rise.
At the close, the Dow
(
$INDU |
Quote |
Chart |
News |
PowerRating) recouped about a third of
yesterday’s losses as it gained 116.24 points, or 1.39%. The S&P
(
$SPX.X |
Quote |
Chart |
News |
PowerRating)
gained 15.32 points,
or 1.74%. Finally, the Nasdaq
(
$COMPX |
Quote |
Chart |
News |
PowerRating) gained 28 points, or 2.22%.
In sector action,
networkers
(
$NWX.X |
Quote |
Chart |
News |
PowerRating) was up 5.6%, broker/dealers
(
$XBD.X |
Quote |
Chart |
News |
PowerRating) was up 4.84%,
airlines
(
$XAL.X |
Quote |
Chart |
News |
PowerRating) was up 4.77%, and Internets
(
$DOT.X |
Quote |
Chart |
News |
PowerRating) rose 4.67%.
All
roared back today.
On the other hand, gold
(
$XAU.X |
Quote |
Chart |
News |
PowerRating) dropped 2.41%, thus
giving up all of yesterday’s gains. Oil service issues
(
$OSX.X |
Quote |
Chart |
News |
PowerRating) also
continued their decline. The semiconductor index
(
$SOX.X |
Quote |
Chart |
News |
PowerRating) gained 5.33
points, or 1.87%. Semis briefly traded at a level not seen October of 1999. Intel
(
INTC |
Quote |
Chart |
News |
PowerRating) will give their business update on Thursday, although many firms
have already cut estimates for the chip giant, any more disappointing news could
resume the selling in the techs.
The VIX
(
$VIX.X |
Quote |
Chart |
News |
PowerRating) had an inside day after the huge pop up yesterday. It gapped
down, opened near
its highs, and closed near the lows of the day. This shift in intraday sentiment
shows a drop in fear. The VIX triggered CVR 2 and 3 buy signals. After the
recent spike up, volatility looks like it’s going to head back toward its mean.
In contrast, the VXN
(
$VXN.X |
Quote |
Chart |
News |
PowerRating)
had an outside day today. It gapped, opened near its highs, and closed near the
lows of the day. This shift
in intraday sentiment also shows a drop in fear. The VXN also triggered CVR 2
and 3 buy signals.
Points of Significance:
| Volatility Index |
Close | Net Change |
Signals/Direction | % Above/Below 10 Day Moving Average |
Significance |
| VIX | 39.94 |
DOWN 3.92 |
CVR 2, 3 BUY |
13.30% Above |
At Extreme |
| VXN | 57.42 |
DOWN 1.37 |
CVR 2, 3 BUY |
11.08 % Above |
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 |
| Hovanian Enterprises |
HOV |
+ 12.62 |
1352 |
242 |
| Symantec |
SYMC |
+ 11.16 |
6100 |
2920 |
| Coach |
COH |
+ 10.64 |
1529 |
207 |
| PetsMart |
PETM |
+ 5.05 |
1689 |
442 |
| Daimler Benz |
DCX |
+ 4.13 |
6454 |
852 |
| Patterson Energy |
PTEN |
– 3.94 |
10855 |
688 |
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 |
| Financial Sector SPDR |
XLF |
27.9 |
24.2 |
37 |
13.6 |
| Arkansas Best |
ABFS |
60.1 |
52.7 |
48.8 |
44.8 |
| Hershey Foods |
HSY |
39.2 |
34.6 |
38.5 |
16.1 |
| McDonalds |
MCD |
38.5 |
34.6 |
38.5 |
21.2 |
| Cigna |
CI |
38.7 |
34.8 |
51.3 |
25.1 |
| Qualcomm |
QCOM |
73.6 |
67.3 |
82.6 |
53.8 |
Spike Down
| Name | Symbol | IV | Previous IV |
High IV |
Low IV |
| Gap Inc. |
GPS |
63.6 |
75.1 |
82.6 |
45.4 |
| Coach Inc. |
COH |
49.7 |
57.5 |
77.1 |
40.6 |
| Miller Herman |
MLHR |
39..7 |
45.1 |
45.4 |
29.8 |
| NCO Group |
NCOG |
56.7 |
63.6 |
81.6 |
41.9 |
| Johnson & Johnson |
JNJ |
34.4 |
38.5 |
46.1 |
18.8 |
| NPS Pharmaceuticals |
NPSP |
76.9 |
85.2 |
140.9 |
51.7 |
Please use stops on every trade!