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Posts Tagged ‘OPEN’

Bulls Take A Seat At OpenTable

www.interactivebrokers.com

Trading in out of the money calls on OpenTable (Ticker: OPEN) this morning pushed options volume on the provider of online restaurant reservation services to more than twice the average daily level this morning, with upwards of 9,000 contracts changing hands in the early going versus an average daily reading of around 4,300 contracts.

The most traded options on OPEN are the 21Feb’14 $77.5 strike calls, with around 6,000 lots in play against open interest of roughly 1,200 contracts. It looks like traders quick enough out of the gate managed to pay as little as $0.10 apiece for approximately 1,500 of the calls. Gains in the price of the underlying, which spiked 4.0% near the open, coupled with an influx of buyers of the $77.5 calls pushed the premium on the contracts up to as high as $0.80 each at the same time that the stock price touched its intraday high of $77.85. The price of the underlying has since backed off those highs dragging down with it the prevailing premium on the contracts, which currently show a bid/ask spread of $0.05/$0.20 each. With expiration looming large and the price of the stock sitting decidedly lower than the $77.5 striking price, the morning purchase of these contracts may have generated transaction costs and little else by the looks of it. However, a review of time and sales data indicates some traders stepped in to sell the calls at an average premium of $0.27 each roughly an hour into the session. It’s difficult to say either way who is behind the selling, but perhaps buyers of the calls this morning were able to book quick profits on their positions at OpenTable this morning.

Looking out to options with more life left in them, the March expiry calls were also active during the first 30 minutes of the session. The Mar $80 strike calls traded roughly 1,000 times, with much of the volume purchased at a premium of $1.90 per contract. Traders long the calls stand ready to profit at expiration next month in the event that shares in OpenTable surge 7.0% over the current price of $76.50 to exceed the breakeven point at $81.90. Shares in the name last traded above $81.90 back on January 21st

Chart – P&L of long Mar 80 Call Strategy in IB Option Strategy Lab
Current (solid line), At expiration (dotted line)


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Bearish Options Traders Take A Seat At OpenTable

www.interactivebrokers.com

Today’s tickers: OPEN, FDO & EAT

OPEN - OpenTable, Inc. – Shares in OpenTable are moving lower this morning, down 2.9% at $65.96 as of 11:10 a.m. ET, after analysts at Citigroup initiated a ‘sell’ rating on the stock with a price target of $58.00. Options on the provider of online restaurant reservations are more active than usual, with volume nearing 1,200 contracts versus the stock’s average daily volume of around 600 contracts. Front month put options are seeing the most action, specifically at the Jul $65 strike where more than 800 contracts have changed hands so far today. It looks like most of the $65 puts were purchased for an average premium of $1.13 apiece, thus positioning buyers to profit at expiration next week in the event that OpenTable’s shares dip 3.2% from the current price of $65.96 to breach the average breakeven point on the downside at $63.87.

FDO - Family Dollar Stores, Inc. – Upside call options are changing hands on discount retailer, Family Dollar Stores, Inc., today with shares in the name up as much as 4.6% in the early going to touch a six-month high of $66.90. The company reported better than expected third-quarter comparable store sales growth and higher than expected third-quarter earnings ahead of the opening bell. The Aug $67.5 strike calls attracted the most volume during morning trading, with upwards of 3,900 contracts in play against open interest of 138 contracts. It looks like most of the $67.5 strike calls were purchased for an average premium of $1.60 apiece. Call buyers stand ready to profit at expiration next month should shares in FDO rally another 3.3% over today’s high of $66.90 to surpass the average breakeven price of $69.10. Shares in Family Dollar Stores last traded above $69.10 in December of 2012.

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Testy Tuesday – AAPL Rebalancing in May May Keep the Nasdaq from 2,800 Today

A staff member holds the new Apple iPad2 at the Apple store in London March 25, 2011. REUTERS/Luke MacGregorThe Nasdaq is finally rebalancing!  

That is good news but not so much for Apple, Inc., whose current 20.49% weighting in the index will be cut to 12.33% on May 2nd.  This explains a lot of the strange movement in the Nasdaq as apparently the cognescenti have already begun jockying their positions – trying to guess which of the 100 stocks in the Composite Index will curry some of AAPL’s lost favor.  

Perhaps the the moves up in fellow 4-letter stocks like PCLN ($25Bn market cap), NFLX ($13Bn), OPEN ($2.5Bn), BIDU ($50Bn) and GMCR ($9.4Bn) don’t seem quite so crazy in light of the 40% reduction in AAPL ($314Bn) – take the money out of one bucket and you HAVE to fill up the others!  

This does make me feel better as there may actually be a rational reason for NFLX having a p/e of 82 despite the fact that they have a completely indefensible service that already has competition from several on-line clones as well as big boys like AMZN, not to mention every cable and satellite company in America.  Why does WFMI, a GROCERY STORE, trade at 41 times it’s projected 2011 earnings in the middle of the worst food inflation in US history?  It’s not just because rich people are stupid and will overpay for anything because they hate to have people think they can’t afford stuff – it’s because their market cap is $11.4Bn and if you take 40% of AAPL’s $300Bn and distribute it around the Nasdaq – then WFMI get’s $1.2Bn of additional allocation.  

That’s not exactly how it works but that’s the effect.  A $1Bn Index fund who follows the Nasdaq has $205M of AAPL stock (20.49%) and, after the reweighing, they are to have $123M of AAPL stock.  The other $82M does, in fact, get distributed to the other Nasdaq stocks according to the new weightings.  Do you think that doesn’t distort the markets?  Of course, that doesn’t "just" affect the Nasdaq – AAPL is a heavyweight in all the indexes.  

The special rebalancing of the NASDAQ-100 Index will be enacted based on index securities and shares outstanding as of March 31 – now it is very clear why the MoMo stocks were jacked up like crazy into the end of Q1 – now the market manipulators have guaranteed bagholders for their stocks come May 2nd!  On…
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PSW Wrap-Up Show for the Week

We have a new episode of The Wrap-Up Show.

This time, it’s a quick review of the week’s activity:

Also, as we have a ton of Government Data that will be driving the markets next week, let’s review "How the US Government Manipulates Inflation Data" – just so we remember not to take it all too seriously.  


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Wednesday – Working Toward the Clampdown

 

No man born with a living soul
Can be working for the clampdown
Kick over the wall ’cause government’s to fall
How can you refuse it?
Let fury have the hour, anger can be power
D’you know that you can use it?

The voices in your head are calling
Stop wasting your time, there’s nothing coming
Only a fool would think someone could save you 

In these days of evil presidentes
Working for the clampdown
But lately one or two has fully paid their due
For working for the clampdown – The Clash

Portugal is having a national strike today and labor unions in Ireland are planning “mass mobilization” in protest of planned spending cuts, with a march in Dublin on Nov. 27.

Portugal said in September it would cut the wage bill by 5 percent for public workers earning more than 1,500 euros ($2005) a month, freeze hiring and raise value-added taxes by 2 percentage points to 23 percent to help reduce a deficit that amounted to 9.3 percent of gross domestic product last year. The measures are included in the government’s 2011 spending plan, which faces a final vote in parliament on Nov. 26.  “The strike arises in a context of a set of measures that are quite significant and have social impact,” said Carlos Firme, a director at Lisbon-based Banif Banco de Investimento SA. “It’s natural that there are demonstrations of discontent.”

I’m sure King George’s Bankster buddies told him the same thing when the American colonists expressed their "discontent" – Don’t worry my King, there’s sure to be some grumbling from the peasants but your stimulus package is working wonderfully – now come outside and check out the golden horseshoes I put on my carriage team!  

We were able to add a little bling to our own rides as those QQQQ $53 puts I told you about in yesterday’s morning post, which we picked up in Member chat on Monday at .45, opened at .75 and flew on up to $1.25 (up another 110% from Monday’s entry) and pulled back to finish the day at .98.  We were, of course, very happy to take a daily double off the table because that’s all you need to stay ahead of the game.  Even if you are just playing with $450 (10…
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Zero Hedge

What Happens After A Mega Corporation Raises Its Workers' Wages

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

Earlier today, McDonalds announced that it would become the latest company to raise hourly pay for 90,000 workers by more than 10% and add benefits such as paid vacation for its restaurant workers. Specifically, starting in July, MCD will pay at least $1 per hour more than the local legal minimum wage for employees at the roughly 1,500 restaurants it owns in the U.S. The increase will lift the average hourly rate for its U.S. re...



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Phil's Favorites

5 Charts Which Show That The Next Economic Crash Is Dead Ahead

Courtesy of Michael Snyder at The Economic Collapse

When an economic crisis is coming, there are usually certain indicators that appear in advance.  For example, commodity prices usually start to plunge before a recession begins.  And as you can see from the Bloomberg Commodity Index which you can find right here, this has already been happening.  In addition, I have previously written about how the U.S. dollar went on a great run just before the financial collapse of 2008.  This is something that has also been happening over the past few months.&nb...



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Chart School

Bulls Continue To Defend Recent Swing Lows

Courtesy of Declan.

Today's losses took indices to test March lows before buyers stepped in to bring things back by the close.

For the Nasdaq, bulls came in at the 50-day MA, although today's action registered as higher volume distribution.


The S&P didn't quite make it to the more significant March low, instead buyers stepped up on the test of last week's swing low. However, technicals returned to net bearishness, with on-balance-volume trending lower across the March double top; whatever late day buying there was, it was outgunned by the selling trend.

...

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All About Trends

Mid-Day Update

Reminder: David is available to chat with Members, comments are found below each post.

Click here for the full report.




To learn more, sign up for David's free newsletter and receive the free report from All About Trends - "How To Outperform 90% Of Wall Street With Just $500 A Week." Tell David PSW sent you. - Ilene...

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Sabrient

Sector Detector: Defensive sectors lead hesitant market, but traders honor long-standing bullish support

Reminder: Sabrient is available to chat with Members, comments are found below each post.

Courtesy of Sabrient Systems and Gradient Analytics

Last week, the major indexes fell back below round-number thresholds that had taken a lot of effort to eclipse. There has been an ongoing ebb-and-flow of capital between risk-on and risk-off, including high sector correlations, which is far from ideal. But at the end of it all, the S&P 500 found itself right back on top of long-standing support and poised for a bounce, and Monday’s action proved yet again that bulls are determined to defend their long-standing uptrend line.

In this weekly update, I give my view of the current market environment, offer a technical analysis of the S&P 500 chart, review our weekly fundamentals-based SectorCast...



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Digital Currencies

Federal Agents Investigating Bitcoin Money Laundering Stole Over $1 Million In Bitcoin

Courtesy of ZeroHedge. View original post here.

This is one of those sad times when The Onion realizes it has badly, and permanently, missed its IPO window.

Just released from the Department of Justice

Former Federal Agents Charged With Bitcoin Money Laundering and Wire Fraud

Agents Were Part of Baltimore’s Silk Road Task Force

Two former federal agents have been charged with wire fraud, money laundering and related offenses for stealing digital currency during their investigation of the Silk Road, an underground black market that al...



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OpTrader

Swing trading portfolio - week of March 30th, 2015

Reminder: OpTrader is available to chat with Members, comments are found below each post.

 

This post is for all our live virtual trade ideas and daily comments. Please click on "comments" below to follow our live discussion. All of our current  trades are listed in the spreadsheet below, with entry price (1/2 in and All in), and exit prices (1/3 out, 2/3 out, and All out).

We also indicate our stop, which is most of the time the "5 day moving average". All trades, unless indicated, are front-month ATM options. 

Please feel free to participate in the discussion and ask any questions you might have about this virtual portfolio, by clicking on the "comments" link right below.

To learn more about the swing trading virtual portfolio (strategy, performance, FAQ, etc.), please click here ...



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Promotions

Watch the Phil Davis Special on Money Talk on BNN TV!

Kim Parlee interviews Phil on Money Talk. Be sure to watch the replays if you missed the show live on Wednesday night (it was recorded on Monday). As usual, Phil provides an excellent program packed with macro analysis, important lessons and trading ideas. ~ Ilene

 

The replay is now available on BNN's website. For the three part series, click on the links below. 

Part 1 is here (discussing the macro outlook for the markets) Part 2 is here. (discussing our main trading strategies) Part 3 is here. (reviewing our pick of th...

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Market Shadows

Kimble Charts: South Korea's EWY

Kimble Charts: South Korea's EWY

By Ilene 

Chris Kimble likes the iShares MSCI South Korea Capped (EWY), but only if it breaks out of a pennant pattern. This South Korean equities ETF has underperformed the S&P 500 by 60% since 2011.

You're probably familiar with its largest holding, Samsung Electronics Co Ltd, and at least several other represented companies such as Hyundai Motor Co and Kia Motors Corp.

...



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Option Review

Cypress Semi Draws Bullish Option Plays

Bullish trades abound in Cypress Semiconductor options today, most notably a massive bull call spread initiated in the July expiry contracts. One strategist appears to have purchased 30,000 of the Jul 16.0 strike calls at a premium of $0.89 each and sold the same number of Jul 19.0 strike calls at a premium of $0.22 apiece. Net premium paid to put on the spread amounts to $0.67 per contract, thus establishing a breakeven share price of $16.67 on the trade. Cypress shares reached a 52-week high of $16.25 back on Friday, March 13th, and would need to rally 4.6% over the current level to exceed the breakeven point of $16.25. The spread generates maximum potential profits of $2.33 per contract in the event that CY shares surge more than 20% in the next four months to reach $19.00 by July expiration. Shar...



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Pharmboy

2015 - Biotech Fever

Reminder: Pharmboy is available to chat with Members, comments are found below each post.

PSW Members - well, what a year for biotechs!   The Biotech Index (IBB) is up a whopping 40%, beating the S&P hands down!  The healthcare sector has had a number of high flying IPOs, and beat the Tech Sector in total nubmer of IPOs in the past 12 months.  What could go wrong?

Phil has given his Secret Santa Inflation Hedges for 2015, and since I have been trying to keep my head above water between work, PSW, and baseball with my boys...it is time that something is put together for PSW on biotechs in 2015.

Cancer and fibrosis remain two of the hottest areas for VC backed biotechs to invest their monies.  A number of companies have gone IPO which have drugs/technologies that fight cancer, includin...



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Stock World Weekly

Stock World Weekly

Newsletter writers are available to chat with Members regarding topics presented in SWW, comments are found below each post.

Here's this week's Stock World Weekly.

Click here and sign in with your user name and password. 

 

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Help One Of Our Own PSW Members

"Hello PSW Members –

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 jennifersurovy@yahoo.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.

http://www.youcaring.com/medical-fundraiser/help-get-shadowfax-out-from-the-darkness-of-medical-bills-/126743

Thank you for you time!




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About Phil:

Philip R. Davis is a founder Phil's Stock World, a stock and options trading site that teaches the art of options trading to newcomers and devises advanced strategies for expert traders...

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Ilene is editor and affiliate program coordinator for PSW. She manages the site market shadows, archives, more. Contact Ilene to learn about our affiliate and content sharing programs.

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