Wednesday’s Options Alerts
The pattern continues, as after
yesterday’s monster recovery in the Dow, we failed to see
any more follow though.
Once again trading was very volatile as the Dow fell for the seventh consecutive
session, dropping over 230 points in the early morning after Caterpillar
(
CAT |
Quote |
Chart |
News |
PowerRating)
missed their numbers. The index recovered the majority of the
losses before selling off again during the final hour of trading. At the close,
the Dow
(
$INDU |
Quote |
Chart |
News |
PowerRating) finished 166 points or 1.92% lower. The S&P 500
(
$SPX.X |
Quote |
Chart |
News |
PowerRating)
dropped 17 points or 1.85% lower. The Nasdaq
(
$COMPX |
Quote |
Chart |
News |
PowerRating) was again the
strongest performer as it up actually up 25 points intraday. However the index
also succumbed to late session selling and finished the day 7.34 points or 0.53%
lower.Â
Greenspan began his semiannual testimony before Congress today. He
stated that everything was in place for an economic recovery, but the
number of corporate scandals that have misplaced investor’s trust could keep the
growth in check. In after hours action, Intel
(
INTC |
Quote |
Chart |
News |
PowerRating) missed their second
quarter numbers by 2 cents and plans to lay off 5% of its workforce.
Fear again spiked higher, but the
level of emotions wasn’t as wild as yesterday. The VIX
(
$VIX.X |
Quote |
Chart |
News |
PowerRating) gapped up,
opened in the lower half of the range and closed near the highs of the day. This shift
in intraday sentiment shows a rise in fear. Today’s action
triggered another CVR 3 buy signal as the VIX is still more than 10% away from
its moving average. The action in the VXN
(
$VXN.X |
Quote |
Chart |
News |
PowerRating) was almost the same as
yesterday’s. The VXN also had an inside day today as it opened in the bottom of
its range and closed just above its open. This shift in intraday sentiment
also shows a increase in fear. The VXN didn’t trigger any signals today.
Points of Significance:
Photon Dynamics
(
PHTN |
Quote |
Chart |
News |
PowerRating)
dropped over 11.50% on
more than nine times its average volume. Shares of the company, which was supposed to report results after the
close, came under
heavy selling pressure after they posted their third quarter results on their
website in the morning. Either way the company missed by 3 cents a shares
and also stated that they were expecting 1 to 5 cents a share next quarter, which
is well below estimates of 16 cents a share. The shares are currently testing
support at 23.55.
| Volatility Index |
Close | Net Change |
Signals/Direction | % Above/Below 10 Day Moving Average |
Significance |
| VIX | 42.05 | UP 2.75 |
CVR 3 BUY |
16.84% Above |
At Extreme |
| VXN | 67.94 | UP 0.09 |
NONE | 7.28 % Above |
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 |
| Maytag | MYG | – 16.82 |
2208 | 337 |
| Photon Dynamics |
PHTN | – 11.49 |
3788 | 596 |
| Fleetboston Financial |
FBF | – 10.57 |
8049 | 1228 |
| Masco | MAS | – 8.99 |
2620 | 273 |
| Enzon | ENZN | + 6.96 |
3817 | 635 |
| Gap Inc. |
GPS | – 6.85 |
5816 | 872 |
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 |
| Cox Communications |
COX | 75.7 | 55.6 | 60.1 | 31.1 |
| Leggett & Platt |
LEG | 39.1 | 29.8 | 30.1 | 18.2 |
| Corinthian Colleges |
COCO | 85.3 | 67.5 | 57 | 35.6 |
| American Standards |
ASD | 46 | 36.5 | 34.1 | 24.6 |
| Furniture Brands |
FBN | 56.3 | 44.9 | 50.3 | 36.1 |
| Flowserve | FLS | 54 | 43.8 | 44.3 | 31. |
Spike Down
| Name | Symbol | IV | Previous IV |
High IV |
Low IV |
| J.B. Hunt | JBHT | 67.8 | 89.2 | 67.2 | 47.9 |
| Astoria Financial |
AF | 25.2 | 30.3 | 24.2 | 20.1 |
| American Water Works |
AWK | 12.7 | 15.1 | 13.6 | 8.7 |
| Roslyn Bancorp |
RSLN | 27.8 | 32.6 | 32.6 | 21.4 |
| Gucci Group | GUC | 25.5 | 29.4 | 23.7 | 10.3 |
| Luxottica Group |
LUX | 32.7 | 37.6 | 42.2 | 23.5 |
Please use stops on every trade!