Your update on options trading today.

Bullish flow detected in California Pizza Kitchen (NASDAQ: CPKI), with 4567 calls trading, or 217 times its recent average daily call volume.

Bullish flow detected in Air Products and Chemicals (NYSE: APD), with 2674 calls trading, or six times its recent average daily call volume.

Bullish flow detected in Clean Energy Fuels (NASDAQ: CLNE), with 2577 calls trading, or three times its recent average daily call volume.

Increasing volume is also being seen in Eastman Kodak (NYSE: EK), Corning (NYSE: GLW), and Nokia (NYSE: NOK).

Sentiment

With an hour to go to the close, stocks are broadly lower following a round of mixed earnings news. American Express (NYSE: AXP) is down 3% and the biggest drag on the Dow Jones Industrial Average after its earnings, released Monday afternoon, failed to live up to Street estimates. Five other Dow stocks released results Tuesday morning and, while Traveler’s (NYSE: TRV) and Verizon (NYSE: VZ) are trading higher, DuPont (NYSE: DD), 3M (NYSE: MMM), and Johnson &Johnson (NYSE: JNJ) are suffering post-earnings losses. Investors seemed to shrug off the day’s economic data, which included a much stronger-than-expected reading on January consumer confidence. According to the Conference Board’s Index, consumer confidence increased to 60.6 this month, from 53.3 in December and significantly better than economists had expected (53.5). The Dow Jones Industrial Average is trading lower despite the data and is down 60 points heading into the final hour. The tech-heavy NASDAQ lost 12. The CBOE Volatility Index (VIX) is up .80 to 18.45 and probing 2011 highs, as investors await the conclusion of FOMC and post-meeting statement Wednesday afternoon. Trading in the options market is active and reflects the more cautious underlying tone, with 7.5 million calls and 6.8 million puts traded so far.

Bullish Flow

Star Scientific (NASDAQ: CIGX) saw a spike to $2.08 this morning after a US Patent and Trademark Office ruling in favor of the company related to a patent re-examination case. Shares have given up most of the gains, up just 2 cents to $1.73. Meanwhile, some investors have been paying a nickel and a dime for CIGX Feb 2 Calls, with 11,650 traded. Feb 1.5 puts, Mar 2 calls, May 2 calls, and Aug 2 calls are seeing interest as well. 15,000 calls and 1,015 puts have changed hands. Earnings come into play in early-February. The Petersburg, Va.-based cigarette maker posted a $4.8 million loss when earnings were last reported on Nov. 10.

Investors are sizing up Citrix Systems (NASDAQ: CTXS) ahead of earnings. Shares are down $2.50 to $62.20. In options action, 9,870 calls and 5,380 puts traded so far. Most of the activity is in smaller lots. Two of the top trades: a CTXS Feb 62.5 – 65 Call spread bought at $1.10, 250 times. Feb 72.5 calls, Feb 60 puts, Mar 57.5 puts, and Jun 75 calls are seeing interest as well. Implied volatility is up 2% to 48.5 ahead of earnings, after the closing bell tomorrow.

Bearish Flow

Bank of America (NYSE: BAC) loses 47 cents to $13.45 and BAC Feb 15 Call is today’s most actively traded options contract. 70,500 contracts on the tape so far. The top trade is a block of 3,618 on the 7 cent bid. It might be a liquidating trade on diminishing hopes for a move beyond $15 by the Feb expiration in 24 days. Open interest in the contract, which is now 11.5% out-of-the money, is 214,214.

Implied Volatility Mover

The VIX is up .79 to 18.44 and probing its 2011 closing high of 18.47 set Friday. The “fear gauge” is up today, as the S&P 500 Index loses 4.5 points and trading turns a bit more cautious ahead of tomorrow’s FOMC meeting. A flood of earnings releases along with economic numbers later this week, (New Home Sales tomorrow, Durable Goods Thursday, and GDP Friday), add some event risk as well. In total options have seen 7.5 million calls and 6.8 million puts traded with one hour to go to close, which reflects a bit more put activity (relative to calls) than seen in recent weeks. Meanwhile, trading in VIX is light, but seems to reflect concerns about volatility in the short-term as well. 145,000 calls and 42,000 puts traded on the VIX so far. VIX March 24 Calls are the most active.

Frederic Ruffy is the Senior Options Strategist at Whatstrading.com, a site dedicated to helping traders make sense of the complex and fragmented nature of listed options trading.