Schaeffer's Trading Floor Blog
Stocks quoted in this article:

Momentum names that made notable moves on Tuesday and could continue to do so into Wednesday's session include drugstore chain Rite Aid Corporation (NYSE:RAD), oil-and-gas company Goodrich Petroleum Corporation (NYSE:GDP), and Chinese Internet concern Qihoo 360 Technology Co Ltd (NYSE:QIHU). Here is a quick look at these stocks ahead of tomorrow's opening bell.

Rite Aid Corporation (NYSE:RAD)

Rite Aid has been a truly unstoppable force on the charts over the past 12 months. Today, the stock scored a fresh decade-plus high of $8.02, and even though it finished the session 0.6% lower at $7.82, the equity is still trading at roughly three times its year-ago value. As such, in RAD's options pits, more than 10 calls have been bought to open for every put during the past 20 sessions, resulting in an International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) call/put volume ratio of 10.42. Today, calls were again the contracts of choice on an absolute basis. However, put volume did outpace the average daily amount by a nearly 11-to-1 margin.

Goodrich Petroleum Corporation (NYSE:GDP)

With Goodrich jumping 4.9% today to close at $24.11, the stock is now positioned 41.7% above its year-to-date flat line. Not surprisingly, GDP has been popular among option bulls of late. The equity boasts a top-heavy 10-day ISE/CBOE/PHLX call/put volume ratio of 19.04, which ranks in the 83rd annual percentile. In other words, speculators have bought to open calls over puts at a faster-than-usual clip of late. Of note, however, some of these option bulls may actually be short sellers in disguise, hedging against more upside. Short interest currently accounts for 42.8% of GDP's available float, which would take more than eight sessions to cover, at the shares' average daily volume.

Qihoo 360 Technology Co Ltd (NYSE:QIHU)

Yesterday's rally in Qihoo shares was short-lived, with the stock tumbling 4.3% today to close at $80.34, in the wake of a price-target cut to $100 from $130 at Maxim this morning. Nevertheless, activity in QIHU's options pits remained heavily call-skewed, with these contracts more than quadrupling puts by the end of the session. Looking back two weeks paints a similar picture on QIHU, which has racked up a 10-day ISE/CBOE/PHLX call/put volume ratio of 5.15. What's more, this ratio ranks higher than all other comparable readings taken during the past year, meaning the recent rate of call buying, relative to put buying, is at an annual-high level. However, with short interest climbing 22.8% during the last two reporting periods -- and now accounting for 5.4% of the equity's float -- perhaps some of the recent call activity came at the hands of short sellers, picking up insurance on the stock.


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