Thursday’s Options Alerts

• June 12, 2002
• TradingMarkets Editors

We had another roller coaster day in
the markets today as an early morning sell off took the Nasdaq 100
(
$NDX.X |
Quote |
Chart |
News |
PowerRating) 9 points below its September lows. Then a late-afternoon rally took all of
the major indices in the green. Much of the news today painted a mixed picture.
Tech stocks got hit early morning thanks in part to Siebel Systems
(
SEBL |
Quote |
Chart |
News |
PowerRating)
and Juniper Networks
(
JNPR |
Quote |
Chart |
News |
PowerRating), both of which came out with very cautious
remarks. Both companies said that they don’t see things getting any
better. However semis were strong after Motorola
(
MOT |
Quote |
Chart |
News |
PowerRating) expected second
quarter earnings to meet or beat expectations. Today’s much-anticipated Fed
Beige Book came in mixed to positive. The Fed reported that the economy was
growing at a moderate pace, but the growth among different segments were uneven.
For more information on today’s action, please refer to
the market
recap.

The VIX
(
$VIX.X |
Quote |
Chart |
News |
PowerRating) opened near
the bottom third of its range, spiked higher, and closed near the lows of
the day. This shift
in intraday sentiment shows a decrease in fear. The VIX triggered a CVR
5 buy signal today. The VXN
(
$VXN.X |
Quote |
Chart |
News |
PowerRating) opened near the top third of its
range and closed on the lows of the day. This shift in intraday sentiment
also shows a decrease in fear. The VXN triggered both CVR 1 and 2 buy signals today.
Tech stocks showed a dramatic reversal today. This has the potential to carry
through for a few more sessions, however, we are still in a steep downtrend and
any rallies could be good selling opportunities.

Points of Significance:

Siebel Systems
(
SEBL |
Quote |
Chart |
News |
PowerRating)
dropped 14% on more than double its average volume. The shares took a beating
today after the company’s CFO gave a gloomy report about the corporate IT
environment. Goldman Sachs also came out and lowered Siebel’s fiscal 2002
earnings estimates to 40 cents from 45 cents and 2003 to 50 cents from 56 cents.
Shares of Siebel are zeroing in on their September lows.

Safeway
(
SWY |
Quote |
Chart |
News |
PowerRating)
dropped 12% on almost 10 times its average volume. They were hammered today after
the company cut its second quarter and fiscal 2002 earnings, due to decreasing
sales and restructuring expenses. Other supermarket chains such as Albertson’s
(
ABS |
Quote |
Chart |
News |
PowerRating),
Kroger
(
KR |
Quote |
Chart |
News |
PowerRating), and Winn Dixie
(
WIN |
Quote |
Chart |
News |
PowerRating) also took a beating. Supermarket issues
also have been weak lately as retail giant Walmart
(
WMT |
Quote |
Chart |
News |
PowerRating) has plans to expand
into the grocery business. Shares of Safeway hit levels not seen since December
of 1999.

Maytag
(
MYG |
Quote |
Chart |
News |
PowerRating) jumped over 7% on
double its average volume. Shares of the appliance giant were boosted today
after the company reported an increase in sales and raised its second quarter
and full year earnings estimates. Maytag does still have a lot of resistance
along the 46.50 area.

Abnormal Options Volume With Price Movement
—
Abnormal options volume (calls and puts) with stock price movement

Stocks With Biggest Spikes in Implied
Volatility — Stocks with biggest increases or decreases in implied
volatility compared to previous day

Spike Up

Spike Down

Please use stops on every trade!