Tuesday’s Options Alerts
Despite good news from Compaq Computer
(
CPQ |
Quote |
Chart |
News |
PowerRating)
and Circuit City
(
CC |
Quote |
Chart |
News |
PowerRating), the market broke its three-day winning streak. For more information
on today’s action, please
refer to the market
recap. The VIX
(
$VIX.X |
Quote |
Chart |
News |
PowerRating) opened near and closed in the bottom third of
its range. The intra-day shift in sentiment
suggests that fear is continuing to head back down. No CVR signals were triggered today.
However, the market does appear to be starting to work off the low VIX condition.
The VXN
(
$VXN.X |
Quote |
Chart |
News |
PowerRating)
opened in the lower third of its range and closed near the half-way point of its
range. This intra-day shift in sentiment also
suggests that that fear is rising. The VXN did not trigger any CVR
signals either.
Points of Significance:
Airgate PCS
(
PCSA |
Quote |
Chart |
News |
PowerRating) dropped almost 15% today on
over seven times its average trading volume. The company is falling on the news
that Radio Shack
(
RSH |
Quote |
Chart |
News |
PowerRating) reported a decline in cell phone sales. Options on
Airgate traded over 12 times its average volume. There is heavy activity in the
Jan 40 and 50 puts. It’s implied volatility is at a new high. Look for short
volatility strategies such as strangles and ratio spreads.
Peregrine Systems
(
PRGN |
Quote |
Chart |
News |
PowerRating) gained almost 10% on
double its average volume as it is pulling back from lows after last week’s
plunge . The company introduced its AssetCenter 4.0 management solutions
software. This newer version of AssetCenter allows organizations to better
control expenses through cost avoidance and cost reduction. Its options traded
over double their average volume. There is heavy volume in the February 10
calls.
Microtune
(
TUNE |
Quote |
Chart |
News |
PowerRating) gapped down and fell over
eight percent today on almost triple its average volume. The shares did find
support and bounced off their 20-day moving average. The implied volatility is
also somewhat low. Look for possible long volatility strategies such as
backspreads, straddles, and long positions.
Implied volatility for ATI Technologies
(
ATYT |
Quote |
Chart |
News |
PowerRating)
is at a new high. The stock appears to be consolidating after recent gains. Look for short volatility strategies
such as ratio spreads, straddles, and strangles.
| Volatility Index |
Close | Net Change |
Signals/Direction | % Above/Below 10 Day Moving Average |
Significance |
| VIX | 22.09 | UP 0.07 | NONE | 3.24 % Below | Not At Extreme |
| VXN | 47.89 | UP 1.03 |
NONE | 0.001 % 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 |
| Airgate PCS | PCSA | – 14.96 | 2097 | 166 |
| Peregrine | PRGN | + 9.77 | 5898 | 2184 |
| Microtune | TUNE | – 8.85 | 1145 | 209 |
| Viisage Technology | VISG | – 8.52 | 761 | 166 |
| Halliburton | HAL | + 7.92 | 37516 | 17045 |
| Kronos Inc. | KRON | – 7.15 | 322 | 118 |
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 |
| Airgate PCS | PCSA | 81.1 | 56.1 | 71.3 | 54 |
| Walgreen | WAG | 31.2 | 26.1 | 39.1 | 26.4 |
| ATI Technologies | ATYT | 76.2 | 64.9 | 69.8 | 56.7 |
| Sherwin-Williams | SHW | 40.3 | 34.7 | 40.4 | 25.7 |
| NetBank | NTBK | 45.5 | 39.3 | 83.4 | 36.6 |
| EGL, Inc. | EAGL | 75.6 | 66.6 | 77.3 | 66.1 |
Spike Down
| Name | Symbol | IV | Previous IV |
High IV |
Low IV |
| Champion Enterprises | CHB | 70.6 | 83.2 | 95.7 | 57.8 |
| New Plan Excel Realty |
NXL | 21 | 24.2 | 26.8 | 20 |
| McDermott Int’l |
MDR | 69.5 | 79.1 | 106.2 | 66.6 |
| Halliburton | HAL | 94.2 | 107.2 | 89.9 | 45.2 |
| Equity Residential |
EQR | 20.6 | 23 | 30.2 | 17.7 |
| Solutia | SOI | 61.4 | 67.5 | 55 | 32 |
Please use stops on every trade!