Wednesday’s Options Alerts
Despite news of lower layoffs, the revenue
warning from Peoplesoft and Goldman’s trimming of earnings estimates on numerous
tech stocks hammered the markets. In other news,
oil stocks were again the strongest performers as crude oil traded
past the $28 level. Gold and defensive stocks also were strong performers while
software, semiconductors, and airliners were the weakest. For more information on today’s action, please refer to
the market
recap.
The VIX
(
$VIX.X |
Quote |
Chart |
News |
PowerRating)
opened near the midpoint of its range and closed near the lows of the day.
Despite the gap up, this shift in
intraday sentiment suggests that fear is dropping. Today’s action triggered another CVR
I buy signal. The VXN
(
$VXN.X |
Quote |
Chart |
News |
PowerRating) opened near its lows and closed on near the highs of the day. This shift in intraday sentiment
shows that fear is increasing. No CVR signals were triggered by the VXN today.
Points of Significance:
PeopleSoft
(
PSFT |
Quote |
Chart |
News |
PowerRating) plunge over 32% on
nine times its average volume. The shares were decimated after the company
announced a shortfall in licensing revenues and earnings. Peoplesoft is now at a
six month low.Â
Best Buy
(
BBY |
Quote |
Chart |
News |
PowerRating)
dropped over 5% on double its average volume. The company announced fourth
quarter earnings that jumped 84% and beat estimates by a penny. However the
company warned that its first quarter earnings are likely to fall below
estimates due to weak sales. Best Buy shares did manage to close above its .382
retracement level. There is heavy activity in the May 75 puts.
Cablevision
(
CVC |
Quote |
Chart |
News |
PowerRating) dropped 7% on
triple its average volume. The shares of the largest cable operator in the New York
area came under pressure today after it announced that it would offer rebates to
subscribers for not airing all of the Yankees games this season. There is heavy
activity in the June 25 puts.Â
| Volatility Index |
Close | Net Change |
Signals/Direction | % Above/Below 10 Day Moving Average |
Significance |
| VIX | 20.68 | UP 0.63 |
CVR I BUY |
2.53% Above |
Not at Extreme |
| VXN | 39.32 | UP 2.87 |
NONE | 3.45 % 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 |
| PeopleSoft | PSFT | – 32.67 |
27864 | 10489 |
| JAKKS Pacific |
JAKK | – 9.86 |
390 | 139 |
| Documentum | DCTM | – 8.57 |
564 | 138 |
| Cablevision Systems |
CVC | – 7.77 |
1799 | 824 |
| SAP | SAP | -6.91 | 7275 | 412 |
| Best Buy |
BBY | – 5.62 |
13196 | 5775 |
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 SPDRs |
XLF | 15.6 | 11.2 | 28.4 | 17.4 |
| Ceridian | CEN | 34.3 | 26.2 | 56.9 | 25.9 |
| Quest Software |
QSFT | 109.5 | 86.6 | 98.3 | 71.8 |
| PeopleSoft | PSFT | 73.4 | 58.6 | 104.4 | 63 |
| JDA Software |
JDAS | 66.4 | 55.1 | 75.5 | 55.5 |
| PennzEnergy | PZL | 31.8 | 26.7 | 54.2 | 31.8 |
Spike Down
| Name | Symbol | IV | Previous IV |
High IV |
Low IV |
| Rare Hospitality |
RARE | 43 | 52.7 | 57 | 40.01 |
| New Plan Excel Realty |
NXL | 14.9 | 18 | 32.9 | 17.7 |
| GP Financial |
GPT | 21.8 | 25.9 | 46.5 | 24.6 |
| National City Corp. |
NCC | 17.8 | 20.6 | 36.2 | 19.1 |
| Consumer Staples SPDRs |
XLB | 20.4 | 18.2 | 42 | 17.3 |
| Forrest Labs |
FRX | 27.3 | 31 | 39.7 | 26.8 |
Please use stops on every trade!