Options Market Commentary

Risk-on is in back en vogue this afternoon as equities march higher on a better than expected January Retail sales figure (0.2% vs. 0% est.) Currently, the S&P is +1.1%, the Russell is +1.2% and the Nasdaq +1.7%. Bonds have weakened mildly (TLT -.4%, US 10 year yield up to 2.645%) even as the New York Fed cut its Q1 GDP forecast to 0.2% from 0.5%. In single name action, Apple is bid today (+3.2%) thanks to an upgrade from BofA. Crude oil is recovering some of Friday’s losses (+1.2%) as the dollar softens a bit (-0.1%). Volatilities are meaningfully lower with the VIX -9% at 14.62, VXN -11% to 16.98, and RVX -8% at 17.62.

ETF 30D Volatility Changes

SPY:    -12%

IWM:   -10%

QQQ:  -11%

Directional Options Strategies

Bullish Option Strategies

DAL Buyer 2,200 Mar 29^th 52 – 53 call spreads (ref. 50.41)

USB Buyer 2,500 Apr 26^th 52.5 calls (ref. 51.11)

BTG 5,500 Mar – Apr 2.5 call spreads trade (appears to roll out, Earnings 3/12, ref. 3.06)

KAR Buyer 5,000 Apr 50 calls tied to stock (ref. 47.71)

CNAT Buyer 5,000 Apr 2 calls (ref. 2.13)

Bearish Option Strategies

JD 12,000 Jan 20 puts trade tied to stock (appears bought, ref. 27.40)

RLGY Seller 11,700 Mar 17.5 puts to Buy 11,900 Sep 10 puts (monetizes, rolls out and down, ref. 12.39)

MU Buyer 5,000 Jun 35 puts tied to stock (ref. 39.30)

BGS Buyer 7,500 Mar 25 – May 22.5 put spreads (rolls out and down, ref. 23.69)

TLRD Seller 5,000 Mar 12 puts to Buy 11,000 Mar 13 puts (rolls up, adds units, Earnings 3/12, ref. 11.71)

Macro Options Strategies

Bullish Option Strategies

TLT Buyer  10,000 Apr 122 puts to Sell 10,000 Sep 122 puts (both legs opening, collects $2.26, ref. 121.18)

VXXB Seller 10,000 Apr 37 calls tied to stock (ref. 32.58)

EWZ Seller 13,500 Mar 41 puts tied to stock (ref. 42.48)

XOP Buyer 13,000 Apr 31 calls to Sell 18,000 Apr 32 calls (ref. 28.17)

SPY Buyer 13,129 Mar 29^th 284 calls (ref. 277.69)

QQQ 10,000 Mar 175 – Apr 178 call spreads trade (appears to roll out and up, ref. 173.79)

GLD 7,000 Mar – May 125 call spreads trade (appears to roll out, ref. 122.16)

EFA Seller 7,500 Mar 64 – 63.5 strangles tied to stock (sells premium, directionally neutral, ref. 63.75)

Bearish Option Strategies

EEM 54,214 Mar 41.5 puts trade tied to stock (possibly closing, ref. 42.24)

XLI Seller 4,000 Mar 74.5 – 70 put spreads to Buy 4,000 Mar 22^nd 73 puts (rolls out, ref. 73.67)

SPY Buyer 12,240 Mar 18^th 275 – 270 put spreads (ref. 276.73)

IWM 10,500 Dec 130 – 105 1x2 put spreads trade (ref. 152.90)

Finance Trades Options Strategies

NIO 3,400 Mar 12 RevCons trade (ref. 6.79)

ELAN 11,000 Mar 40 RevCons trade (ref. 30.51)

Upcoming Earnings

Volatility Standouts