Call Volume Surges During KNDI, BLNK Stock Rallies

KNDI and BLNK stocks are two of the biggest winners today

by Josh Selway

Published on Feb 20, 2019 at 2:20 PM
Updated on Jun 24, 2020 at 10:16 AM

Stocks spent most of the day just above breakeven, while traders now digest the latest Fed minutes. Three names to watch today are Tesla rival Kandi Technologies Group Inc (NASDAQ:KNDI), charging station operator Blink Charging Co (NASDAQ:BLNK), and financial firm Charles Schwab Corporation (NYSE:SCHW). Let's take a closer look what's happening with shares of KNDI, BLNK, and SCHW today.

NHTSA Approval Sends KNDI Stock to New High

KNDI stock is taking Wall Street by storm today, after the National Highway Traffic Safety Administration approved two of its electric vehicles. The shares have jumped 46.5% to $8.71, earlier touching an annual high of $8.85, and volume is soaring in and out of the options pits. Call volume of 14,000 is already at a new annual high, and the March 8 call is most popular overall. Anyone buying to open the option would be wagering on more gains over the next month.

Kandi Technologies shares were trading at just $3.63 coming into 2019, and got a solid bump in early January thanks to more upbeat news around its electric vehicle production. Data wise, what stands out is the high short interest levels surrounding the security, as these bearish bets account for 16.3% of the total float -- suggesting some gains could be attributed to a short squeeze.

BLNK Enjoys Kandi Tailwinds

The news around Kandi Technologies is also acting as a tailwind for BLNK stock, which is trading up 29.3% at $3.94. The shares are set to close above the formerly resistant 200-day moving for the first time in over a year, bringing their year-to-date gain to roughly 77%.

Meanwhile, call volume is running at 10 times the expected pace today, and the deep in-the-money March 2.50 call is in the lead. Call buying has been the preferred strategy among Blink Charging options traders in recent weeks at the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), where more than 18.57 were bought to open for every put in the past two weeks.

UBS Says Sell Charles Schwab Stock

SCHW shares are under pressure after UBS cut its rating to "sell" from "neutral," and lowered its price target to $42 from $48. The stock was last seen down 1.9% at $46.15. The 160-day moving average has been acting as a ceiling since the mid-January bull gap, though the $44 level -- right where Charles Schwab closed the day prior to said gap -- served as a notable floor back on Feb. 8. For sure, the equity's longer term trend has been downward, losing 9.5% in the past six months.

Bullish or bearish, it would appear to be a good time to pick up short-term options on SCHW, based on its Schaeffer's Volatility Index (SVI) of 23%, ranking just 4 percentage points from a 52-week low. In other words, volatility expectations seem muted at the moment.


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