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Ahead of Auto Data, Bears Race Toward Ford Motor Company (F)

Ford Motor Company (F) puts are crossing at a faster-than-usual rate

by 3/2/2015 2:57 PM
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Ahead of tomorrow's monthly report on auto sales, speculators are placing bearish bets on Ford Motor Company (NYSE:F), with puts changing hands at an accelerated clip. Most popular is the March 15 put. Data shows that some of the over 5,600 contracts that crossed here were bought to open, as traders bet on the security to fall below $15 by the close on Friday, March 20, when front-month options expire.

Puts have been growing increasingly popular among F speculators in recent weeks. Looking at data from the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) shows that the stock's 50-day put/call volume ratio of 0.35 is higher than 97% of all similar readings from the past year.

Analysts' opinions on the security are split. Six covering brokerage firms have issued "buy" or better ratings, while nine others have handed out "holds" or worse. F's average 12-month price target comes in at $16.82.

Ford Motor Company (NYSE:F) hasn't traded below $15 since Feb. 2. However, the stock is currently struggling to topple the $16.50 region, which has acted as both support and resistance since mid-2013. Plus, the March 17 strike is home to notable call open interest, which could translate into options-related resistance in the near term.

Weekly Chart of F since July 2013

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3D Systems Corporation (DDD) Traders Bet On a Rebound

Short interest levels are high on 3D Systems Corporation (DDD)

by 3/2/2015 2:05 PM
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3D Systems Corporation (NYSE:DDD) is down 1.4% this afternoon to trade at $30.03, after the company announced an agreement with health care products distributor Henry Schein, Inc. (NASDAQ:HSIC). However, at least one group of options traders is keeping the faith in DDD.

At last check, calls are being exchanged at more than triple the pace of puts. Most active is the weekly 3/6 31.50-strike call, where buy-to-open activity is detected. In short, these buyers are confident DDD will rebound back above $31.50 by week's end, when the series expires. Earlier today, in fact, the shares rose as high as $31.75.

While DDD has taken a step back since its intraday high, the $30 level appears to be serving as a foothold once again. Since Feb. 11, this area has not been breached on a daily closing basis.

Elsewhere, short sellers are waiting for technical support to falter. Nearly 35% of 3D Systems Corporation's (NYSE:DDD) float is dedicated to short interest, which would take over two weeks to buy back, at typical daily trading levels. That said, if support holds and the equity starts creeping higher, an exodus of shorts could result in tailwinds.


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McDonald's Corporation (MCD) Option Traders Hungry for Triple Digits

McDonald's Corporation (MCD) front-month calls are active today

by 3/2/2015 1:18 PM
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McDonald's Corporation (NYSE:MCD) is enjoying broad-market tailwinds, with the shares exploring triple-digit territory for the first time since July. In the options pits, speculators are gambling on the blue-chip restaurateur to extend its journey higher in the short term, with calls more than doubling puts, and trading at twice the average intraday clip.

The stock's 30-day at-the-money implied volatility has jumped 13.9% to 20.5%, underscoring the growing appetite for near-term contracts. Garnering notable buy-to-open attention are the March 99.50 and 103 calls, the latter of which is the most active contract on the day. By purchasing the calls to open, the buyers expect MCD to muscle north of the strikes through options expiration at the close on Friday, March 20. MCD hasn't toppled $103 since mid-May.

However, the equity -- last seen 1.3% higher at $100.17 -- sports a 14-day Relative Strength Index (RSI) of 69, on the cusp of overbought territory, and the shares could run into a roadblock in the $100-$102 region. This area provided support for MCD shares from April to July 2014, but could now switch roles to serve as resistance. Plus, the March 100 strike is home to significant call open interest in the front-month series, with more than 32,500 contracts outstanding. This heavy accumulation of calls could reinforce resistance in the round-number area.

In fact, McDonald's Corporation (NYSE:MCD) option traders have grown increasingly bullish during the past 10 weeks. The stock's 50-day call/put volume ratio on the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) sits at 2.57 -- in the 82nd percentile of its annual range. However, the stock's Schaeffer's Volatility Scorecard (SVS) of 26 indicates that MCD has tended to make undersized moves during the past year, relative to what the options market has priced in.

Daily Chart of MCD since April 2014

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Tesla Motors, Inc. (TSLA) Beatdown Brings in Bears

Short-term traders are rushing Tesla Motors Inc (TSLA)

by 3/2/2015 12:16 PM
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Tesla Motors Inc (NASDAQ:TSLA) is getting hammered this afternoon -- down 2.8% at $197.62 -- bucking the broad-market trend higher. In the stock's options pits, puts outweigh calls by a healthy margin, and are running at a 57% premium to their typical intraday rate.

TSLA's weekly 3/6 series is garnering notable attention, with each of the automaker's 10 most active options expiring at this Friday's close. Bears are honing in on the weekly 3/6 200-, 195-, and 190-strike puts, as they roll the dice on continued downside through week's end.

Taking a step back, it's been a rough few months for TSLA. The shares have dropped roughly 11% in 2015, and have stair-stepped their way lower since topping out at $291.42 in early September.

As such, put buyers have been active at the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) in recent months. Tesla Motors Inc's (NASDAQ:TSLA) 50-day put/call volume ratio of 1.05 outranks 82% of comparable readings from the previous year.

Daily Chart of TSLA since September 2014


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Boston Scientific Corporation (BSX) Bettors Bail Amid New High

M&A news has Boston Scientific Corporation (BSX) fresh off a multi-year high

by 3/2/2015 11:11 AM
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Boston Scientific Corporation (NYSE:BSX) is fresh off a multi-year high of $17.25, after agreeing to buy Endo International plc's (NASDAQ:ENDP) urology portfolio for up to $1.65 billion. At last check, BSX was still up 2% at $17.24, bringing its year-to-date lead to more than 29%. Meanwhile, action is heating up in the stock's options pits.

So far, BSX calls are crossing the tape at two times the expected intraday rate, and more than 10 times the speed of puts. Digging deeper, the March 15 call is most active, with a mix of buyer- and seller-driven action. Those buying the calls to open expect BSX to extend its journey north of $15 through the next few weeks, while those selling the calls to close are locking in paper profits ahead of expiration.

Given BSX's technical tenacity, it comes as little surprise that analysts have boarded the stock's bullish bandwagon. Fifteen of 22 covering analysts have handed out "buy" or better ratings, versus seven "holds" and not a single "sell."

Sentiment appears less sanguine in Boston Scientific Corporation's (NYSE:BSX) options pits. The equity's 50-day put/call volume ratio across the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) is 1.08 -- in the 78th annual percentile. However, a portion of these positions may have been initiated by shareholders picking up downside insurance.


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