Option Watch

The bulls fight back with a minor retracement today. Let’s take a look at some of the options data for today. Look at the option chains for the stocks listed below as their option activity has seen some tremendous increase today. Typically you can see what others are thinking by looking at the option volume and perhaps see some institutional action as well.

As an example, nearly 5,000 puts for the Dec. 08 $30 strike went out today on $REG. The stock gained $4.67 or nearly 17% so perhaps these are a bullish sell, or naked put, to the market.

The put/call ratio is a key indicator of sentiment towards a stock with high ratios signaling bearish sentiment. If you look at the charts for these companies and see them approaching resistance then that would make the high put/call ratio logical from a technical perspective. However, if there aren’t any levels of resistance ahead then the chances increase that the high put/call ratio might be fundamental in nature.