Option Investor
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Jeff Bailey : 3/10/2006 11:42:07 AM

GOOG March Option Montage at this Link ... This doesn't look bullish, not at all.

The hand typed OI changes are changes in OI since the 02/28/06 close (day CFO made "negative" comment at Merrill's Analyst day).

While some believe that too much put buying is bearish and can signal a turn, there's getting to be som much "in the money" puts and "out the money" calls, that there could be a lot of stock ready and willing to be sold into next Friday's quarterly expiration.

Maybe it is just me, but I don't see too much open interest, or changes in open interest that are still in the money. Market participants don't seem overly eager to trade in, or out of their in the money calls. Heck! I'd be trying to salvage what gain I had.

Could it be that the call OI is a "you can have it" at that strike if you want it, as I've lost some trust/faith in current management.

Now look at the PUT side of the equation. Heck! Outside of the 1,516:1,220 DnTick:UpTick on the 350 PUTS (GGD-OJ) I see very little sign of bullish PUT selling. And that 350 "support" zone is quickly becoming a "resistance" zone.

It is looking RISKIER to be trying to sell PUT PREMIUM each day. 10-points down again today on GOOG and there's still 6 trading days until expiration.

Funny as it seems, I think our $410 naked calls performed better when GOOG's stock was rising (because IV was falling). The $410s likely go no bid.

See today's slight "turn" at the $360 calls with UpTick almost 2:1 vs. DnTick. Then look at the nearly 2:1 DnTick vs. UpTick at the $350 and $370 calls. If we see OI INCREASE tomorrow, I've got to be thinking that market participants are selling the lower calls strike, but then buying the next higher strike as protection and looking for IV erosion into expiration.

In essence, PREMIUM sellers seem more comfortable with the selling of call premiums.

Here's the 03/01/06 Option Montage where OI reflects up to and including the 02/28/06. Link

Management: What it says and what it does is MOST IMPORTANT. If you ever get the chance to read or listen to a book on tape, I strongly recommend From Good to Great by Jim Collins.

Collins' research team found that General Electric (GE) 10% box size Link was/is a "good company." (Sorry Jack)

Neucor (NUE) 10% box size Link was/is a "great company" that figured out the steel business and how to survive and thrive. Bethlehem Steel never could figure things out and Collin's research team gives important clues as to why.

Altria (MO) 10% box size Link a "great company?" A company that sells products that can kill you? Fascinating research as to what makes a company great. Why did those stock so vastly outperform the market? Was it their product? Was it the "in thing?"

Collins' team suggests that their research showed it was MANAGEMENT!

OI Technical Staff : 3/9/2006 9:59:59 PM

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Jeff Bailey : 3/9/2006 6:16:55 PM

I'm not bold enough to sell NAKED March puts on GOOG Link at this point. GOOG closes below its rising 200-day SMA for first time in stock's young history. It is an "emotional" stock.

We've got a pretty good week/month going at this point and no sense trying to get cute. 6-days left until expiration and that's plenty of time to do something.

Had an idea that GOOG might trade $345 today, but I couldn't make much sense from the "sell naked put" side of things.

Noted a pretty large PUT BUYER in the March $320 Puts (GGD-OD) at $2.15 and by the close, that trade is still a winner at the close.

Jeff Bailey : 3/9/2006 6:23:01 PM

Current OPEN MM Profiles found at this Link

Today's Activity ... Bearish swing trade closed out the 1/2 position short in Baidu.com (BIDU) at the offer of $48.85 ($+2.40, or +4.68%). Now "watch listed" and looking for a bounce back near $51.

Should still have an open order (good until canceled) to buy back the GOOG Mar $410 Call (GOP-CB) for $0.10.

Jeff Bailey : 3/9/2006 5:44:04 PM

Closing Internals found at this Link

Jeff Bailey : 3/9/2006 5:16:16 PM

Closing U.S. Market Watch found at this Link

Jeff Bailey : 3/9/2006 4:51:02 PM

Google (GOOG) ... flat with its close in extended session. Ho-hum...

Jeff Bailey : 3/9/2006 4:50:24 PM

I saw the first part of that headline and caught my breath. If there's one "fear" I have of being short BIDU, it is the possibility that they get taken out by somebody to get a footprint in China.

Jeff Bailey : 3/9/2006 4:48:54 PM

Google (GOOG) ... DJ - Buys small Web Word Processing Startup Writely.

Jeff Bailey : 3/9/2006 5:01:41 PM

03:12 PM EST Temperatures with April Nat. Gas and Heating Oil futures settlements at this Link

April Unleaded settled up 4.24% at $1.7201.

April Crude Oil settled up 0.75% at $60.47.

June Unleaded was up a more modest 1.68% at $1.7197.

June Crude Oil was up 1.16% at $63.42.

Quick thoughts: I think the reason the April Unleaded contract was up as sharp as it was is due to yesterday's EIA Unleaded data. One reason I'm following the June contract is that gets us into summer.

What this "refiner bull" must continue to test is why Banc of America Securities was rather cautious, if not bearish some of the refiners several sessions ago. If there is a bear case, it is that there is PLENTY of capacity that can come back online (see EIA capacity data yesterday). Some refiners have shut down part of their capacity for maintenance

Jeff Bailey : 3/9/2006 4:06:54 PM

Google (GOOG) $343.00 -3.07% ... there's a tie within the pivot ... DAILY Pivot Levels for tomorrow ... $330.65, $336.82, Piv= $347.68, $353.85, $364.71

Jeff Bailey : 3/9/2006 3:55:36 PM

Baidu.com (BIDU) $48.13 -6.52% ... at least it made an effort to close off the lows.

Jeff Bailey : 3/9/2006 3:53:46 PM

GOOG $342 ... If there's any tie with DAILY Pivots and levels we've looked at, it would be DAILY S1 and the recent relative lows we marked at $337.83.

Jeff Bailey : 3/9/2006 3:50:04 PM

GOOG $342.80 ... prelim DAILY Pivot Levels for tomorrow ... $331.77, $337.54, Piv= $348.04, $353.81, $364.31.

Jeff Bailey : 3/9/2006 3:22:07 PM

03:00 Internals found at this Link

Jeff Bailey : 3/9/2006 3:06:35 PM

GOOG $343.10 ... gulp!

Jeff Bailey : 3/9/2006 3:04:54 PM

GOOG Option Chain as GOOG traded $345 Link ... Somebody's selling some in the money puts. Long liquidators taking a profit? Or naked? We don't know, but do see a "turn" at $345.

I'm not that aggressive and would rather sell OUT the money if selling naked and premiums.

Jeff Bailey : 3/9/2006 2:54:49 PM

GOOG did trade $345 with session low of $344.67.

Jeff Bailey : 3/9/2006 2:53:35 PM

Those GGD-OD are right back at $2.00 x $2.15. Volume brisk at 5,601

Jeff Bailey : 3/9/2006 2:51:41 PM

Baidu.com (BIDU) quick review of trade on 15-minute interval chart Link

Jeff Bailey : 3/9/2006 2:35:36 PM

Current OPEN MM Profiles found at this Link

Jane Fox : 3/9/2006 1:53:22 PM

Dateline SCC Dubai-owned company has decided to transfer fully the U.S. operation of P&O ports in North America to a U.S. entity, according to Sen. John Warner.

Jeff Bailey : 3/9/2006 1:41:11 PM

If you're thinking of selling an OUT THE MONEY GOOG call at the correlations in the Matrix, then WAIT for GOOG to trade that level, make some observations (see if volume comes in). Do NOT trade on the first kiss unless you're trading a target and closing a GAIN.

Jeff Bailey : 3/9/2006 1:39:09 PM

I have to step away for about 20-minutes. Have a conference call I have to attend. Should be over by 02:00 EST.

Jeff Bailey : 3/9/2006 1:36:14 PM

Buyers in the $380 Cal for average of $1.78.

Jeff Bailey : 3/9/2006 1:34:54 PM

GOOG Option Chain sorted by most active at this Link ... RED arrow to the option I saw trade 1,000 at the offer.

$320 + or - $2.15 gives me roughly $318-$322. Does that make sense?

Jeff Bailey : 3/9/2006 1:18:39 PM

01:00 Internals found at this Link

Correction! At the 11:00 hour, the 5 and 10-day NH/NL ratios were correct. However, the intra-day NH/NLs were not correct.

Everything is correct at this post.

Jeff Bailey : 3/9/2006 1:06:36 PM

01:00 Watch found at this Link

Jeff Bailey : 3/9/2006 1:02:27 PM

Ooooo... 1,000 contract just traded in the GOOG Mar $320 puts at $2.15

Jeff Bailey : 3/9/2006 12:56:25 PM

GOOG March/April Option Montage at this Link ... Should GOOG trade $345, watch those $320 and $330 put DnTick and UpTick measures. If they start turning might just sell a naked OUT THE MONEY put.

Jeff Bailey : 3/9/2006 12:38:04 PM

Google (GOOG) $347.55 -1.78% ... the GOP-CB are bid/offer $0.20 x $0.30.

Let's take a quick look at the option montage and see what's going on. $345 isn't that far away.

Jeff Bailey : 3/9/2006 12:27:59 PM

O gets another square at $47.00 Link ...

Jeff Bailey : 3/9/2006 12:26:40 PM

I've got to wonder what that "bid" in BIDU was all about late last week. Was it some market maker manipulation, working together to "get short" with their knowing the stock was set to fall? Bugger kissed WEEKLY Pivot on Friday, hugged WEEKLY/MONTHLY Pivot Monday/Tuesday, and yesterday's break of WEEKLY/MONTHLY Pivot was the kiss of death. Now they should be covering around WEEKLY S2 was/is my thought. I think the stock will still get a bounce back to where we shorted it initially. Now we've got a sell signal to work with.

You think GOOG trades with a high multiple? BIDU is roughly 257-times earnings.

SOHU $21.15 +0.95% Link a reasonable 27-times earnings.

Jeff Bailey : 3/9/2006 12:05:33 PM

Baidu.com (BIDU) $47.54 -7.5% ... breaks below WEEKLY S2.

Jeff Bailey : 3/9/2006 11:43:14 AM

Sunoco (SUN) $76.07 -0.93% ... session low has been ..... $75.50.

Slit the difference between $75 and $80. Could be.

Jeff Bailey : 3/9/2006 11:41:11 AM

Was thinking the same thing Marc.

Jeff Bailey : 3/9/2006 11:29:18 AM

11:00 Internals found at this Link

Marc Eckelberry : 3/9/2006 11:11:03 AM

My guess is we need one more opex push to 41.50

Marc Eckelberry : 3/9/2006 11:10:32 AM

Watch QQQQ 41.

Marc Eckelberry : 3/9/2006 11:09:28 AM

50 ema 10 mn is support and holding. SOX is bullish.

Marc Eckelberry : 3/9/2006 11:08:59 AM

NQ Entry Point Alert -
Long NQ 1665.50, stop 1663.50

Marc Eckelberry : 3/9/2006 11:06:50 AM

NQ hurt by GOOG, but SOX above 511

Jeff Bailey : 3/9/2006 11:03:34 AM

11:00 Market Watch found at this Link

Jeff Bailey : 3/9/2006 10:59:18 AM

April Unleaded (hu06j) $1.70 +3.03% ... session highs! Matches Monday morning's gap lower high.

Jeff Bailey : 3/9/2006 10:55:38 AM

Sunoco (SUN) $76.10 -0.89% ... some pre OPEX volatility? March OI heaviest at $80 Call and $75 Put.

Jeff Bailey : 3/9/2006 10:50:35 AM

Baidu.com (BIDU) $49.08 -4.68% ... just off session lows of $48.26.

Jeff Bailey : 3/9/2006 10:49:05 AM

Google (GOOG) $352.26 -0.45% ... slips red.

Tab Gilles : 3/9/2006 10:33:30 AM

Murphy Oil (MUR) Testing gap on 15 minute chart... Link Link

Jeff Bailey : 3/9/2006 10:33:14 AM

EIA Weekly Nat. Gas Regional Storage at this Link

Jeff Bailey : 3/9/2006 10:32:59 AM

Current OPEN MM Profiles found at this Link ... Closed out the BIDU short, look for bounce back near $50-$51 to short again!

Still should have GTC order to buy back the GOOG Mar $410 Call (GOP-CB) for $0.10. While I think these go no bid into next week's expiration, might be able to close the position, then sell a $400 call premium.

Tab Gilles : 3/9/2006 10:24:31 AM

Nasdaq Summation Index Followup to 2/8/06 7:51PM post. Link

currently... Link

Tab Gilles : 3/9/2006 10:21:46 AM

Eaton Vance Limited Duration Fund (EVV) Back on 1/12/06 10:07 AM post I stated that some money should come off the table on EVV.Then posted 1/17 using a 10-ema daily trailing stop ahving exited early Feb.. Link Link

Jeff Bailey : 3/9/2006 10:11:59 AM

Bearish swing trade short close alert ... Let's take a profit on the Baidu.com (BIDU) short here at $48.85.

Then let's look to short on a bounce.

I think some quarterly window undressing.

Jeff Bailey : 3/9/2006 10:04:39 AM

10:00 Market Watch found at this Link

Jeff Bailey : 3/9/2006 9:43:50 AM

April Unleaded up 1.81% at $1.68

April Crude Oil up 0.58% at $60.37

Jeff Bailey : 3/9/2006 9:42:41 AM

Sunoco (SUN) $77.75 +1.25% Link ... Today's trade at $77.00 would be a 3-box reversal back higher. Need a trade at $79 to set up the "bear trap" trade at $74.

Jeff Bailey : 3/9/2006 9:39:32 AM

Google (GOOG) $355.65 +0.50% Link ...

Jeff Bailey : 3/9/2006 9:37:07 AM

Baidu.com (BIDU) alert $49.20 -4.44% Link ... gives the long-awaited double bottom sell signal at $50.

Jane Fox : 3/9/2006 9:28:09 AM

Dateline WSJ Nominally about U.S. national security, the Dubai Ports World debate has assumed much greater significance as a political issue, and last night it blew up in the face of an administration whose political power is intertwined with the argument that it is keeping America secure.

In what The Wall Street Journal calls a bold rebuke of President Bush, Republicans in Congress joined Democrats in taking the first significant step to reverse the Dubai-based company's takeover of management of operations at five U.S. ports, putting White House efforts to rescue the deal in serious jeopardy. The move suggests the president may face two unattractive options: using a veto to try to keep Congress from killing the transaction - and provoking a showdown with significant parts of his own party - or accepting a face-saving compromise that would be a retreat from his free-trade, pro-business principles, the Journal says. The House Appropriations Committee voted 62-2 to approve an amendment intended to unwind the U.S. portion of DP World's $6.8 billion purchase of London-based Peninsular & Oriental Steam Navigation. The takeover, previously cleared by the administration, formally closed yesterday. But the congressional measure says that "notwithstanding any other provision of law or any prior action," the acquisition of P&O's U.S. facilities "is hereby prohibited and shall have no effect."

Jane Fox : 3/9/2006 9:07:40 AM

Dateline WSJ Initial jobless claims rose by 8,000 to a seasonally adjusted 303,000 in the week ending March 4, the Labor Department said Thursday. That's the highest reading since Jan. 7, 2006. The four-week moving average of initial jobless claims increased last week by 6,250 to 293,500. That's the eighth-straight reading for the four-week average below the 300,000 barrier, suggesting that underlying employment growth prospects remain generally sound.

Jane Fox : 3/9/2006 9:05:28 AM

Dateline WSJ The U.S. trade deficit surged to another record in January as the country's foreign oil bill rose and auto imports increased. The politically sensitive deficit with China also rose, reflecting a flood of Chinese cell phones and clothing.

The Commerce Department said Thursday that the U.S. deficit in international trade of goods and services widened by 5.3% to $68.51 billion from a revised $65.07 billion in December. Overall imports increased 3.5% to a record $182.88 billion, while exports advanced by 2.5% to a record $114.37 billion.

Economist Ian Shepherdson of Valhalla, N.Y., consulting service High Frequency Economics said that though exports are continuing to climb strongly, "the relatively favorable export growth numbers did not prevent the deficit rising." He said that the imbalance won't last as the economy cools, "But that is not the story in January."

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