Options interest is bullish as this stock is dropping. Who is right? When the bond market and the stock market disagree, it is usually the bond market that is right. This from Daily Options Report:
Options order flow has the most value when it goes against the grain of the stock. Like this one.
Houston-based oil driller Smith International (SII) is down $1.29 to $25.22, as a pullback in crude oil weighs on the drillers Monday. Crude was recently down $2.42 to $67.13 a barrel. However, while SII shares are falling, sentiment seems bullish. July 30 calls are the most actives, with 3,250 traded and 80 percent of today’s volume hitting ask-side. Another 1,290 July 37.5 calls traded, with 70 percent traded ask-side. While today’s volume doesn’t yet exceed open interest, ISEE sentiment data indicate that some customers are buying to open. Implied volatility is up to 62, from about 58 late Friday.
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