Wednesday’s Options Alerts
Trading was
quiet and choppy today as investors await the results of the midterm elections and
tomorrow’s Fed meeting. After breaking out of a two-week-plus trading
range yesterday, blue chips continued to drift higher while the Nasdaq struggled
at first, but managed to put in a small rally despite a layoff announcement from
Applied Materials
(
AMAT |
Quote |
Chart |
News |
PowerRating). The October ISM Services Index slipped to 53.1%
from last month’s 53.9%, below expectations for 51.5%.
At the
close, the Dow
(
$INDU |
Quote |
Chart |
News |
PowerRating) gained 106.67 points or 1.24%. The S&P
(
$SPX.X |
Quote |
Chart |
News |
PowerRating) gained
7.05 points or 0.77% and the Nasdaq
(
$COMPX |
Quote |
Chart |
News |
PowerRating) gained 4.43 points or 0.31%.
Top winning sectors were: biotechs
(
$BTK.X |
Quote |
Chart |
News |
PowerRating) up 2.39%, Internets
(
$GIN.X |
Quote |
Chart |
News |
PowerRating)
up 2.17%, pharmaceuticals
(
$DRG.X |
Quote |
Chart |
News |
PowerRating) up 1.75%,and retail
(
$RLX.X |
Quote |
Chart |
News |
PowerRating) up
1.72%. Losing sectors today were: health care
(
$HMO.X |
Quote |
Chart |
News |
PowerRating) down 2.98%,
semiconductors
(
$SOX.X |
Quote |
Chart |
News |
PowerRating) down 2.65%, and telecoms
(
$XTC.X |
Quote |
Chart |
News |
PowerRating) down
0.49%.
Expectations are calling for a 25 basis point cut; the major indices are
already in overbought conditions; therefore anything less than expected could
see a sharp correction and an increase in volatility.
The VIX
(
$VIX.X |
Quote |
Chart |
News |
PowerRating) opened near its highs and closed just below it open. This shift in intraday sentiment still shows a
small drop in
fear.
The VIX triggered triggered a CVR 6 sell signal today. The VXN
(
$VXN.X |
Quote |
Chart |
News |
PowerRating) gapped up, opened near its highs, and closed slightly below
its open. The Vixen also triggered a CVR 6 sell.
Points of Significance:
| Volatility Index |
Close | Net Change |
Signals/Direction | % Above/Below 10 Day Moving Average |
Significance |
| VIX | 34.28 | DOWN 0.19 | CVR 6 SELL |
5.48% Below | Not At Extreme |
| VXN | 51.20 | UP 1.98 | CVR 6 SELL |
0.007% 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 |
| Coventry Healthcare | CVH |
– 6.46 | 1146 | 217 |
| Nordstrom | JWN |
+ 5.48 | 1459 | 374 |
| Watson Pharmaceuticals | WPI |
+ 4.27 | 3615 | 390 |
| Best Buy | BBY |
– 3.57 | 12778 | 3563 |
| Carnival Corp. | CCL |
+ 2.63 | 13202 | 521 |
| Bed Bath & Beyond |
BBBY |
+ 1.63 | 3545 | 1027 |
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 |
|
Eli Lilly
|
ELY |
44.9 | 38.1 | 47.7 | 27 |
| Charles River Labs | CRL |
59.4 | 51.9 | 57.8 | 36.1 |
| Priority Healthcare | PHCC |
55.5 | 48.7 | 70.8 | 44 |
| Marshall Industries | MI |
34.3 | 30.2 | 40.9 | 17.6 |
| Investment Tech Group |
ITG |
56.5 | 50.1 | 59 | 38.1 |
| NPS Pharmaceuticals | NPSP |
77.7 | 69.6 | 140.9 | 70.9 |
Spike Down
| Name | Symbol | IV | Previous IV |
High IV |
Low IV |
|
Golden State Bancorp
|
GSB |
28.1 | 39.7 | 35.1 | 10.3 |
| Aon Corp. | AOC |
55.1 | 64.2 | 75.9 | 28 |
| Synopsys | SNPS |
52.6 | 59.7 | 69.4 | 43.9 |
| Neurocrine Biosciences | NBIX |
63.6 | 71.3 | 49.4 | 63 |
| Comcast | CMCSK |
50.5 | 56.2 | 87.7 | 37 |
| Scholastic Corp. | SCHL |
38.4 | 42.6 | 44.8 | 34.8 |
Please use stops on every trade!