Weekend Market Update
Major Indices Bounce Off Of Key Support Levels

SPDR Dow Jones Industrial Average ETF Trust (DIA) Options Trade Idea

Buy the (DIA) Mar 20 $179/$182/$185 call butterfly for a $0.80 debit or better

(Buy 1 Mar 20 $179 call, sell 2 Mar 20 $182 calls, buy 1 Mar 20 $185 call, all in one trade)

Stop loss- None

Upside target- $182 in the ETF

Financial Select Sector SPDR Fund (XLF) Options Trade Idea

Buy the (XLF) Mar 20 $24 call for for $0.65 or better

Stop loss- None

1st upside target- $1.30

2nd upside target- $2.00

Select Sector Utilities Select Sector SPDR Fund (XLU) Options Trade Idea

Buy the (XLU) Mar 20 $44/$47 bear put spread for a $1.15 debit … Read More »

Smart Money Report

AZN- The Jan 2015 $65/$80/$90 bull call spread risk reversal was put on 10,000 times for a $0.35 debit. Volume was below the open interest in all three options. Net call premium is +$2.2M vs net put premium of -$1.9M.
CVS- More than 5,000 Sep 20 $75 puts were sold for $1.12-$1.19 each, against open interest of 312 contracts. Earnings are due out on 8/5. The stock has moved higher after earnings on 4 out of the last 5 reports. CVS Caremark shares were down 4 out of 5 last week, which brought the stock to test the 50-day EMA. CVS trades at a P/E ratio of 15.25x (2015 estimates) with 12.8% EPS growth (11.5% this year), 4.6% revenue growth (5.7% this year), 1.43% dividend yield, and has an average analyst price target of $82. On 6/6, Susquehanna raised … Read More »

Unusual Options Activity

In today’s Unusual Options Activity Report we highlight call buying in GlaxoSmithKline (GSK) and a bull risk reversal in the Utility ETF (XLU).

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Smart Money Report

AMAT- Another 14,000 Jan. 2015 $22 calls were bought for $0.71-$0.73 each, against open interest of 111,946 contracts. Earnings are due out tonight. There has been large Jan. 2015 call buying in Applied Materials recently.
CCK- Sizable buying in the July $48 and Oct. $46 puts today. Volume was above the open interest in both options. Put activity is 17x the average daily volume. Crown Holdings shares hit a new 52-week high yesterday and trades at a P/E ratio of 14.32x (2014 estimates), PEG ratio of 1.10x (2014 estimates), P/S ratio of 0.77x, has 6.8% revenue growth, and has an average analyst price target of $52. Given the strong fundamental and technical take, this could be a hedge on a long stock position after the recent run up.
GT- 10,000 Oct. $27 calls were purchased for $1.13-$1.24 each, against open … Read More »