DRI - Darden Restaurants, Inc. – Options strategists are feasting on near-term call and put options on the operator of eateries such as Red Lobster and Olive Garden ahead of the firm’s second-quarter earnings report, which is scheduled for release before the market opens on Tuesday. Shares in Darden Restaurants rallied as much as 1.6% during the session to touch an intraday high of $50.67. The impending earnings announcement as well as increased demand for options on the stock lifted Darden’s overall reading of options implied volatility 12.0% to 33.20% as of 12:40pm in New York. Investors expecting shares to shatter the current 52-week high of $50.83 by January 2011 expiration scooped up in-the-money call options. It looks like bulls purchased roughly 2,000 now in-the-money calls at the January 2011 $50 strike for an average premium of $1.92 per contract. Call buyers are prepared to profit should shares in Darden Restaurants jump 2.5% over today’s high of $50.67 to surpass the average breakeven price on the calls at $51.92 by January expiration day. Meanwhile, traders wary that shares of the underlying stock may slip following earnings picked up roughly 1,800 puts at the same January 2011 $50 strike for an average premium of $1.76 each. Put buyers at this strike are poised to profit in the event that the restaurant operator’s shares decline 4.8% to trade below the effective breakeven point on the downside at $48.24 by expiration next month.
AKS - AK Steel Holding Corp. – Options activity on the steel producer today suggests one strategist expects shares in AK Steel Holding Corp. to remain range-bound over the next six months to June 2011 expiration. AK Steel’s shares fell as much as 3.4% during the first half of the trading session to touch down at an intraday low of $15.72. The steel maker’s shares rallied sharply at the end of last week, rising 14.3% from Wednesday’s closing price of $14.42 to Friday’s high of $16.48. But, the sale…
Usually when I can’t think of what to write it helps me to go over our virtual portfolios so I started this morning reviewing the Buy List but I didn’t get far because it was silly. Of 43 plays on the buy list, 39 are doing well – too well in fact to the point where it’s hard for me, in good conscience, not to say let’s kill the whole thing and get back to cash as we’re up about 20% in 2 months and that’s just ridiculous – most people would call that a good year and go on vacation.
The Buy List was 100% bullish and we did catch a good bottom on our early February entries. I was gung ho bullish then because I felt comfortable that the 10,000 line on the Dow would prevail and that we were good for a run back to the top (10,700), following, more or less, the pattern we had in 2004 (see original post for charts). Well that’s pretty much what’s happened since then but that’s not making me happy because I see no reason we won’t complete that pattern and begin falling off a cliff shortly.
As you all know, I’m not a big fan of TA, or patterns for that matter but the reason I started looking for patterns was to try to get a handle on how long market could really keep going up before falling victim to exhaustion. To me it seemed we weren’t at that point on Feb 6th but now that we’ve put in that big push back up – if we can’t punch up to new highs on all our indexes then I do think it’s time for the markets to take a break.
Clearly I’ve been too bearish for the past couple of weeks and we are now 224 points over 10,400 on the Dow which is where I turned bearish as the January data made me lose faith in our ability to get back to 10,700. I should have stuck to the TA because we’re a lot closer to 10,700 than we are to 10,400. With the Russell and Nasdaq exploding to their own new highs. You can see though, from the above chart, why I do want to wait to see the NYSE, Dow and S&P confirm this move up – it’s not far now!…
This is a non-trading topic, but I wanted to post it during trading hours so as many eyes can see it as possible. Feel free to contact me directly at email@example.com with any questions.
Last fall there was some discussion on the PSW board regarding setting up a YouCaring donation page for a PSW member, Shadowfax. Since then, we have been looking into ways to help get him additional medical services and to pay down his medical debts. After following those leads, we are ready to move ahead with the YouCaring site. (Link is posted below.) Any help you can give will be greatly appreciated; not only to help aid in his medical bill debt, but to also show what a great community this group is.
Like all addicts, Central Planners are confident they can manage the monkey on their back. But this is a self-serving illusion.
Addiction is many things, but beneath its complexities it is a self-destructive expression of the desire to avoid or suppress pain. The pain might be physical or the stuff of the mind, memories or inner demons or tortured misgivings about one's choices, soul and life.
Though the self-destructive aspects of the addiction are painfully ...
I don’t really want to keep talk about Ukraine, but it’s too hard to avoid. Besides, it’s not the same story anymore that it was when the week began, since the economic war vs Putin and Russia is now escalating. For reasons that have nothing to do with the plane crash, though they may seem to, a fact that completely seems to escape 999 out of 1000 people.
We still don’t know who shot that plane (we’re not even sure anyone did), and the longer is takes to get evidence for who did it, the more likely it is that such evidence will be tainted and/or fabricated.
That’s undoubtedly why the western media simply bypass the need for evidence, which is worrisome on multiple fronts....
An affiliated company of Advanced Semiconductor Engineering (NYSE: ASX), Universal Scientific Industrial, has reportedly received SiP module orders from Apple (NASDAQ: AAPL) for the iWatch according to industry sources, as reported by DigiTimes. Each SiP module costs approximately $60, which is 20% of the iWatch's rumored $300 price tag.
Volume in Starbucks options is running approximately three times the average daily level for the stock as of 1:15 p.m. ET ahead of the company’s third-quarter earnings report after the close. Shares in the name are up roughly 1.0% just before midday to stand at $79.95. Traders of SBUX options today are more active in calls than puts, with the call/put ratio hovering near 2.0 as of the time of this writing. Much of the volume is in 25Jul’14 expiry options contracts, most notably in the $80 and $83 strike calls which have traded roughly 3,350 and 2,550 times respectively and in excess of existing open interest levels in both strikes. A portion of the volume in the $80 and $83 calls appears to be part of a spread trade.
Despite a highly eventful week in the news, not much has changed from a stock market perspective. No doubt, investors have grown immune to the daily reports of geopolitical turmoil, including Ukraine vs. Russia for control of the eastern regions, Japan’s dispute with China over territorial waters, Sunni vs. Shiite for control of Iraq, Christians being driven out by Islamists, and other religious conflicts in places like Nigeria and Central African Republic. But last Thursday’s news of the Malaysian airliner tragically getting shot down over Ukraine, coupled with Israel’s ground incursion into Gaza, had the makings of a potential Black Swan event, which in my view is the only thing that could derail the relentless bull march higher in stocks.
Nevertheless, when it became clear that the airline...
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We tried holding up stock prices but couldn’t get the job done. Market Shadows’ Virtual Value Portfolio dipped by 2% during the week but still holds on to a market-beating 8.45% gain YTD. There was no escaping the downdraft after a major Portuguese bank failed. Of all the triggers for a large selloff, I’d guess the Portuguese bank failure was pretty far down most people's list of "things to worry about."
All three major indices gave up some ground with the Nasdaq composite taking the hardest hi...
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Well PSW Subscribers....I am still here, barely. From my last post a few months ago to now, nothing has changed much, but there are a few bargins out there that as investors, should be put on the watch list (again) and if so desired....buy a small amount.
First, the media is on a tear against biotechs/pharma, ripping companies for their drug prices. Gilead's HepC drug, Sovaldi, is priced at $84K for the 12-week treatment. Pundits were screaming bloody murder that it was a total rip off, but when one investigates the other drugs out there, and the consequences of not taking Sovaldi vs. another drug combinations, then things become clearer. For instance, Olysio (JNJ) is about $66,000 for a 12-week treatment, but is approved for fewer types of patients AND...
I just wanted to be sure you saw this. There’s a ‘live’ training webinar this Thursday, March 27th at Noon or 9:00 pm ET.
If GOOGLE, the NSA, and Steve Jobs all got together in a room with the task of building a tremendously accurate trading algorithm… it wouldn’t just be any ordinary system… it’d be the greatest trading algorithm in the world.
Well, I hate to break it to you though… they never got around to building it, but my friends at Market Tamer did.
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