Tuesday’s Options Alerts
Working off an overbought condition from last week,
stocks took it on the chin today as the Dow
(
$INDU |
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PowerRating), S&P 500
(
SPX.X |
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PowerRating),
and Nasdaq
(
$COMPQ |
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PowerRating) all posted steep declines. Boeing
(
BA |
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PowerRating)
helped pull the Dow down today as they announced that they lost the largest
Defense Department contract in history to Lockheed Martin
(
LMT |
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PowerRating). Coming off
last week’s overbought condition, the VIX
(
$VIX.X |
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PowerRating) broke a three-day
trend today as it opened near the bottom of its range and closed in the
upper half of its range for the day. This intra-day shift in sentiment suggests that fear is
starting to creep back into the markets. The VIX triggered a CVR
II signal today as the RSI of the VIX upticked off oversold levels. Likewise the VXN
(
$VXN.X |
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PowerRating)
exhibited similar behavior as it opened at the low of today’s range but
the closed near the highs for today. This intra-day shift in sentiment also
suggests that fear is slowly
creeping its way back up. The VXN also triggered a CVR
II signal today as the RSI of the VXN upticked off oversold levels.
Points of Significance:
eFunds
(
EFDS |
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PowerRating) gapped up and reversed, forming
a super wide range key reversal bar on eight times average daily volume. eFunds
also broke below its 200-day moving. Pacific Healthcare Systems
(
PHSY |
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PowerRating)
broke out on three times average daily volume today. Option volume was
heavy, trading six times average daily contract volume. Surebeam
(
SURE |
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PowerRating)
gapped up and reversed to close on its low on 11 times average daily volume.Â
Surebeam’s option activity was heavy as it traded 63 times its average contract
volume. Lockheed Martin
(
LMT |
Quote |
Chart |
News |
PowerRating) gapped up and reversed to close near its lows
on five times average daily volume, forming a key reversal bar for the
day. Lockheed’s implied volatility is also approaching the high end of its
scale. Autonation
(
AN |
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Chart |
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PowerRating) is trading in a pennant. Autonation’s
implied volatiltiy is also approaching the low end of its scale.
| Volatility Index |
Close | Net Change |
Signals/Direction | % Above/Below 10 Day Moving Average |
Significance |
| VIX | 32.39 | UP 1.86 | CVR II |
4.45 % Under | Not At Extreme |
| VXN | 60.29 | UP 3.38 | CVR II |
5.53 % Under |
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 |
| eFunds Corporation |
EFDS | – 21.11 | 755 | 215 |
| Pacificare Health System |
PHSY | + 16.39Â |
2405 | 351 |
| Surebeam | SURE | + 12.60 |
4666 | 73 |
| Boeing | BA | – 10.42 |
18791 | 8911 |
| Celestica | CLS | – 9.77 | 7050 | 1973 |
| Invitrogen | IVGN | – 8.98 |
1892 | 595 |
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 |
| Expedia, Inc. | EXPE | 89 | 66.5 | 105.5 | 49.7 |
| Telefonos de Chile | CTC | 41.8 | 35.2 | 50.4 | 26.2 |
| eFunds Corporation | EFDS | 67.7 | 58.3 | 125.2 | 59.7 |
| Exxon Mobil | XOM | 28.1 | 24.3 | 36.2 | 20.4 |
| Mead Corp. | MEA | 50.8 | 44.6 | 53.8 | 27.8 |
| CIGNA | CI | 41.3 | 36.5 | 43.5 | 28 |
Spike Down
| Name | Symbol | IV | Previous IV |
High IV |
Low IV |
| Lockheed Martin | LMT | 44.2 | 57 | 47.7 | 29 |
| Steris | STE | 53.8 | 66 | 56.7 | 35.2 |
| Boeing | BA | 49.2 | 60.2 | 57.6 | 27.8 |
| Autonation | AN | 41 | 49.8 | 68.6 | 40 |
| Charter One Financial | CF | 32.8 | 39 | 36.4 | 22.2 |
| Eclipsys Corp | ECLP | 78.7 | 88.4 | 101.2 | 57.1 |
Please use stops on every trade!