Tuesday’s Vital Data: Tesla Motors Inc (TSLA), Apple Inc. (AAPL) and Verizon Communications Inc. (VZ)

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Stocks ended largely higher Monday, with traders taking their cues from news that the Fed would be slow to raise interest rates. Oversold levels on many stocks also brought about a round of bargain hunting on Wall Street  The positive atmosphere spilled over into the options pits, with the CBOE’s  put/call volume ratio plunging from Thursday’s high to a near-term low of 0.50 yesterday.

Among the day’s most active stocks in the options pits were Tesla Motors Inc (NASDAQ:TSLA), Apple Inc. (NASDAQ:AAPL) and Verizon Communications Inc. (NYSE:VZ).

Tuesday’s Vital Data: Tesla Motors Inc (TSLA), Apple Inc. (AAPL) and Verizon Communications Inc. (VZ)

Tesla Motors Inc (TSLA)

Put volume soared to well above normal levels for Tesla Motors stock on Monday, making an 130% increase over TSLA’s daily average. Overall, some 173,534 options contracts traded on TSLA stock, with put activity accounting for 57% of the day’s total. Among near-term options, the weekly April 10 series 200 strike and 180 strikes are the most popular among put traders, sporting open interest of more than 2,000 contracts each.

Both of these strikes are currently out of the money after TSLA surged more than 6% on Monday.  Tesla announced that it delivered a record number of vehicles in the first quarter of 2015, with 10,030 Model S sedans eclipsing the company’s own target of 9,500 cars — a figure that is up 55% year-over-year.

The rally was significant from a technical perspective, with TSLA stock breaking out above not only the psychologically key $200 level, but also its 50-day moving average. If the shares can establish a foothold here, it could embolden technical traders and lead to additional short-term gains.

Apple Inc. (AAPL)

With a lack of any fresh headline news, options volume has been on the decline for Apple Inc. shares during the past several weeks. With volume typically trending north of 900,000 contracts per day, AAPL options volume dwindled to just 757,672 contracts on Monday.

Furthermore, calls have made up an increasingly smaller portion of that daily volume, with AAPL’s 21-day put/call volume ratio rising from a mid-February low of 0.42 to its current perch near 0.66. That said, calls still account for the majority of activity, gobbling up 68% of Monday’s total volume.

Technically speaking, AAPL hit a short-term breakout point on Monday. Shares had been squeezed between support at their rising 50-day moving average and resistance at $125 since late March, and Monday saw that overhead resistance give way. AAPL is now staring up at the $130 region, which has capped the stock since late February.

Verizon Communications Inc. (VZ)

Wireless communications giant Verizon made an unusual appearance on the most active options listing on Monday, as volume swelled to record short-term levels. Overall, some 121,600 contracts traded on VZ stock, with calls making up a whopping 93% of Monday’s volume. Among the most popular call strikes for VZ are April $50 (30,925 contracts in open interest), April $49 (41,242 contracts) and April $48 (27,079 contracts). All but the April $50 call closed in the money on Monday.

While Verizon was the subject of several minor headlines on Monday, including news that subscribers can now opt out of the company’s “supercookie tracking,” it was likely VZ’s ex-dividend date of April 8 that sparked the flood of call activity. Specifically, many options traders employ call options in dividend capture strategies that involve some combination of writing deep-in-the-money calls and buying the underlying stock.

As of this writing, Joseph Hargett did not hold a position in any of the aforementioned securities.

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Article printed from InvestorPlace Media, https://investorplace.com/2015/04/tuesdays-vital-data-tesla-motors-inc-tsla-apple-inc-aapl-verizon-communications-inc-vz-options/.

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