Thursday, December 16, 2010

AKS Steel (AKS) - Calls Trade, Vol Pops, Rumors Return

AKS is trading $15.06, up 4.5% with IV30™ up 1.5%. The LIVEVOL™ Pro Summary is below.

The company has traded over 22,000 contracts in less than three hours on total daily average option volume of just 8,733. Over 21,000 calls have traded, yielding a 16:1 call:put ratio. The Stats Tab and Day's biggest trades snapshots are included (below).

The Options Tab (below) illustrates the action. Most of the trading is in Jan, where over 17,000 Jan 15, 16 or 19 calls have traded. Jan 19 shows over 10k on OI of just 677. These were mostly purchased for $0.06 and less. Jan 15 may actually be sales, Jan 16 could be purchases.

The Skew Tab snap (below) illustrates the vols by strike by month.

The Jan 17.5, 19 and 20 calls actually have higher vol than March from the order flow. What's cool is that earnings are 1-25-2010, which is in the March (and soon to be Feb) cycle. So, in English, the non-earnings OTM calls have higher vol than the earnings vol OTM calls.

Finally, the Charts Tab (6 months) is below. The top portion is the stock price, the bottom is the vol (IV30™ - red vs HV20™ - blue vs HV180™ - pink).

We can see the stock has steadily climbed of late. On the vol side (bottom), we can see the IV30™ is right in between the HV180™ and HV20™. The Livevol Strategy Group wrote this earlier today:
"AKS is periodically rumored to be in the sights of larger steel company, Nucor (NUE)."


This is trade analysis, not a recommendation.

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