Your intraday options trading update.
Market is slow as investors await word from Federal Reserve on possible QE III, says Ron Ianieri, chief strategist with ION Options. Ianieri is generally pessimistic seeing gas prices biting consumers’ ability to spend and banks hurt by sluggish housing market.
For now, the market has been buoyed by good earnings but “that’s large companies that sell in China and Asia. That offsets the lack of domestic demand. China is trying to address inflation. That could slow growth and revenues for the large stocks that make up much of the large indices,” said Ianieri.
High Options Volume by Strike
Citigroup (NYSE: C) was tops this morning with its C Jun11 4.5 Call trading 46,123 contracts. The option is up .01 to .19. Another strike C Jan 12 5 Put is seeing more than 40,000 contracts, and id down .02 to .66.
The iShares Silver Trust (NYSE: SLV) is active with its SLV May11 37 Put trading nearly 41,000 contracts. SLV is up .36 to 45.90. The SLV May 50 Call also trading nearly 29,000 contracts. Meanwhile, many traders look for silver to sell off with the ProShares UltraShort Silver (NYSE: ZSL) trading more than 14 million shares this morning. ZSL was down .21 to 14.53.
The power of Apple (NASDAQ: AAPL) may be what is influencing the Technology Select SPDR (NYSE: XLK) as its XLK Jan12 24 Put trades down .28 to 1.05 on 25,304 contracts.
In options Stutland Volatility Group is looking at selling time spreads in large cap indices like the S&P 500 Index Options (CBOE: SPX) or a small cap like the iShares Russell 2000 ETF (NYSE: IWM), said Luke Rahbari, a partner with the Chicago-based investment house.
“With the CBOE Volatility Index (CBOE: VIX) under 16, this is a good time to buy the short term July puts and sell long term like September or December to offset the costs. This is in case we get a ‘Sell in May and go away market’,” said Rahbari.
In equities, Stutland is watching Amazon (NASDAQ: AMZN) which is reporting earnings after the close on Tuesday. The options market is pricing earnings as up or down 5% to 8%. Traders “may get some decent movement off its earnings,” said Rahbari.
Major Stock Trading Volume Movers
Quick-service restaurant firm AFC Enterprises (NASDAQ: AFCE) is down 2.3% to 14.87 and trades 360,000 shares, a rise of 370%.
Home BancShares (NASDAQ: HOMB) is up 2.2% to 22.67 as Stifel Nicolas moves it from a Hold to a Buy.
Changeyou.com Ltd. (NASDAQ: CYOU) up 6.8% to 42.50 on Bank of America reportedly reiterated a Buy rating on the Chinese online game developer. CYOU trades 907,000 shares, up 226%.
Find more option analysis and trading ideas at Options Trading Strategies.
Stocks/Underlying – Big Daily Change in Option Volume
The iShares MSCI Malaysia Index Fund (NYSE: EWM) trades 6,037 options contracts as the ETF falls .03 to 14.82. That’s an increase of almost 1,400% in volume.
Syngenta (NYSE:SYT) is down .19 to 69.26 and options trade 15,514 contracts, a rise of about 1,300%. Bloomberg reports corn cost increases helps ag chemical firms like SYT.
Big jump in X-Rocks, Xerox (NYSE: XRX) with 72,000 options trading as stock falls .22 to 10.00.
BioDelivery Sciences Intl (NASDAQ: BDSI) trades 5,060 options this morning, up 870% and P/C ratio rises.
Stocks – High Put/Call Ratio
ITT Corp. (NYSE: ITT) Put/Call ratio hits 263.28 as stock drops .14 to 58.55. Another three digit P/C ratio is seen in Finish Line (NASDAQ: FINL) as it reaches 111.25 and the stock drops .30 to 20.90. BioDelivery Sciences Intl (NASDAQ: BDSI) is down slightly but P/C ration is at 83.33.
Stocks/Underlying – High Option Volume
SPDR S&P 500 ETF (NYSE: SPY) trades more than 1.5 million option contracts as it drops .39 to 133.39. S&P 500 Index Options (CBOE:SPX) trades 517,867 contracts and falls 4.09 to 1,333.29.
The iShares Silver Trust (NYSE:SLV) gangbusters with 746,000 options contracts, rising to 46.13. Apple (NASDAQ: AAPL) is up 1.31 to 352.01 and seeing 590,000 option contracts traded.
About 264,000 options on the CBOE Volatility Index (CBOE: VIX) trade as it jumps over 15 to rise 1.23 and reach 15.93.
Burney Simpson is the managing editor of InvestorPlace options pages.