Skip to content
  • Home
  • Essentials
        • ESSENTIALS
        • Goals and Budgeting
          • Overview
          • Organizing Your Financial Life
          • Budgeting
          • Your Personal Net Worth
          • Setting Goals
          • Financial Planning
          • Planning Your Charitable Giving
          • 30-Day Financial Cleanse
        • Credit and Debit
          • Overview
          • Good Debt versus Bad Debt
          • How Credit Can Help—and Hurt
          • Understanding Your Credit Score
          • Preventing Identity Theft
          • Paying Off Student Debt
        • Estate Planning
          • Overview
          • Estate Plan Basics
          • Creating an Estate Plan
        • Types of Accounts
          • Overview
          • Choosing the Right Accounts
          • Individual Retirement Accounts
          • Employer Sponsored Retirement Accounts
          • Small Business Retirement Accounts
          • College Savings Accounts
          • Custodial Accounts
          • Understanding FDIC and SIPC Insurance
        • Saving
          • Overview
          • Why You Should Save and How Much
          • Making the Most of Your Paycheck
          • Saving for an Emergency
          • Eight Savings Fundamentals
        • Investing
          • Overview
          • Getting Started with Investing
          • Stocks, Bonds, and Cash
          • Fractional Shares
          • Socially Responsible Investing
          • Understanding Mutual Funds and ETFs
          • Creating an Investment Plan
          • Finding the Right Asset Allocation
          • The Advantages of Diversification
          • Benefits of Compound Growth
          • Tax-Smart Investing
          • The Importance of Monitoring and Rebalancing
        • Taxes
          • Overview
          • Income Taxes
          • Income Taxes for Children
          • Calculate Taxes
          • Payroll Taxes
        • Insurance
          • Overview
          • Insurance You Need
          • Individual Health Insurance
          • Group Health Insurance
          • Understanding Medicare
          • Disability Insurance
          • Life Insurance
          • Long-Term Care Insurance
          • Auto Insurance
  • My Life
        • MY LIFE
        • STARTING OUT
        • BUYING A CAR
        • MILITARY COMMUNITY
        • Buying a Home
          • Overview
          • Buy or Rent?
          • How Much House Can You Afford?
          • Mortgage Basics
          • Beyond Mortgage Costs
        • Jobs
          • Overview
          • Changing Jobs
          • What to Do If You Lose Your Job
          • Managing Your Finances as You Change Jobs
          • Protecting Your 401(k)
        • Getting Married
          • Overview
          • Marrying Your Finances
          • Prenups: Do You Need One?
        • Starting a Family
          • Overview
          • Budgeting for a Child
          • Insurance and Estate Planning Needs
          • Planning for a Child's Education
        • Divorce
          • Overview
          • Preparing Your Finances for Divorce
          • Protecting Yourself During a Divorce
          • Managing Money After a Divorce
        • Helping Aging Parents
          • Overview
          • Talking Money with Aging Parents
          • Insurance Needs
          • Managing Income and Investments
          • Knowing Their Wishes
          • Social Services
        • Losing a Loved One
          • Overview
          • Handling Finances After Loss
          • Special Guidelines for Loss of a Spouse
        • Retirement
          • Overview
          • Starting Retirement
          • Nearing Retirement
          • Enjoying Retirement
  • Ask Carrie
        • ASK CARRIE
        • Planning & Goals
        • Investing Basics
        • Insurance
        • Education Savings
        • Couples & Families
        • Kids & Teens
        • Estate
        • Retirement
        • Major Purchases
        • Banking, Credit & Debt
        • Budgeting & Saving
        • Taxes
        • About Carrie
  • Teaching Kids
        • TEACHING KIDS
        • Basics
          • Overview
          • Rules of the Road at Every Age
          • Budgeting
        • Saving
          • Overview
          • Starting the Savings Habit
          • Motivating Your Kids to Save
          • Tips for Parents with Kids and Teens
        • Investing
          • Overview
          • Introducing Kids to Investing
          • Important Investing Concepts
          • Benefits of Early Investing
          • Investment Accounts for Kids
        • Giving Back
        • Life Lessons
          • Overview
          • Tips for Financial Success
          • Managing an Allowance
          • Help Teens use Credit Wisely
        • Buying a Car
          • Overview
          • Your Teen's First Car
          • Assessing Your Teens Needs and Budget
          • Cash or Financing?
          • Auto Insurance
        • First Job
          • Overview
          • Your Teen's First Job
          • Income Tax Basics
          • Payroll Tax Basics
          • Getting Serious About Saving
        • Going to College
          • Overview
          • Costs Beyond Tuition
          • Life Away from Home
        • Leaving the Nest
          • Overview
          • A Checklist for Leaving Home
        • Activities and Resources
          • Overview
          • Overview
        • Categories
          • Overview
          • Classroom Curriculum
          • Personal Finance Activities
          • Financial Literacy Programs
        • Age Groups
          • Overview
          • Elementary School
          • Middle School
          • High School
  • Tools & Resources
        • TOOLS AND RESOURCES
        • Worksheets
        • Calculators
          • Overview
          • Savings Calculator
          • Credit Card Payoff Calculator
          • Cost of Debt Calculator
          • College Savings Calculator
          • Rent versus Buy Calculator
          • Mortgage Affordability Calculator
          • Retirement Calculator
        • Spending Tracker
        • Monthly Budget Planner
        • Financial Fitness Quiz
        • Documents and Forms
          • Overview
          • Form W-4
          • Form W-2
          • Form 1099
        • Research
          • Overview
          • Studies and Findings
          • Ariel-Schwab Black Investor Survey (2022)
          • Ariel-Schwab Black Investor Survey (2020)
          • Charles Schwab Financial Literacy Survey
          • Young Adult Financial Literacy Survey
          • Older Workers and Money Survey
        • Financial Glossary
        • COVID-19 Resources
  • Foundation
      • FOUNDATION
      • Moneywise America
Search
Market Commentary | June 24, 2022

Today's Options Market Update

Stocks look to close out the week on a high note.
By Nathan Peterson

U.S. stocks are rallying to put a positive finish to a sharp weekly gain that comes as the S&P 500 posted 10 out of last 11 weeks in the red. The sharp rebound is unfolding despite rising concerns about recession as the Fed, and other global central banks, aggressively hike rates to try to arrest the persistent surge in inflation. Treasuries are giving back some of a rally this week that put noticeable downside pressure on yields, and rates are rebounding. The U.S. dollar is adding to a weekly decline after recently rallying to multi-decade highs. Crude oil prices are rebounding from the week's solid drawdown, and gold is seeing modest pressure. The economic calendar offered some upbeat reports as new home sales unexpectedly jumped, and although consumer sentiment hit a record low, the inflation outlook components improved. In equity news, FedEx missed quarterly estimates but offered upbeat guidance, while all 34 financial institutions that participated in the Fed's annual stress test passed. Asia finished out the week in positive fashion and Europe is broadly higher as the global markets show some resiliency in the face of recession worries.   

At 10:55 a.m. ET, the Dow Jones Industrial Average is up 2.0%, the S&P 500 is gaining 2.2%, and the Nasdaq Composite is advancing 2.2%. WTI crude oil is rising $4.01 to $108.28 per barrel, and Brent crude oil is increasing $3.24 at $109.70 per barrel. The gold spot price is dipping $1.90 to $1,827.90 per ounce, and the Dollar Index is declining 0.3% to 104.14. Natural Gas prices have traded in a range of $6.021-6.337 and were last seen trading lower by $0.033 (or -0.53%) to $6.206/MMBtu.

Source: Schwab Center for Financial Research

Today’s Bullish Activity

Shares of FedEx Corp. (FDX + $15.97 to $242.95) are flying higher after the package delivery giant reported Q4 earnings of $6.87 per share, excluding non-recurring items ($0.01 miss) on revenue that rose 8.1% year-over-year to $24.39B (below the $24.56B consensus estimate). The company issued upside guidance as fiscal-year 2023 EPS is expected to come in a range of $22.50-24.50, excluding non-recurring items, versus the $22.40 consensus estimate. Calls are outnumbering puts ~4:3 with the June 24th 250.00 call seeing the most action from traders (volume is 7,230).

Also trading to the upside is Wolfspeed Inc. (WOLF + $6.53 to $69.43) after Goldman Sachs upgraded the provider of silicon carbide and allium nitride materials to “Buy” from “Neutral”, while lowering their price target on the stock to $108.00 from $125.00. Goldman Sachs analyst Brian Lee stated, "… we're tactically more bullish given (i) the most significant EPS inflection in the company's history is now a near-to-medium term event, (ii) improved execution and maturing ramp-up of new capacity sets the pace for potential topline/margin beats and (iii) the entry point is more attractive than it's been in some time with potential for EPS power of >$3 in FY25 implying <20X P/E vs. prior growth upcycles for WOLF averaging 30X-40X. Additionally, while investor concern around new capex has heightened, of late, our analysis suggests ROI on incremental capex is attractive and we believe any increase in capex would be accompanied by increased growth and/or long-term financial targets, another potential positive catalyst.” Calls are outnumbering puts ~4:1 with the July 15th 70.00 call being the highest volume contract (volume is 497).

 

New 52-week highs (22 new highs today): Bristol-Myers Squibb Co. (BMY + $0.83 to $78.52), Eli Lilly &Co. (LLY + $11.98 to $324.78), USA Truck Inc. (USAK + $16.18 to $30.76)

Notable Call Activity

Some unusual call activity (~100:1 over puts) is being seen in Boston Scientific Co. (BSX + $0.90 to $37.83) as all of the top 10 highest volume contracts are calls. Topping the list is the August 19th 42.00 call as volume is 10,821 versus open interest of 271 (suggesting that the volume primarily represents new positioning). The bulk of the transactions on this contract consisted of various-sized blocks that were bought at various times for between $0.45-0.65 each, which suggests bullish intent.

ZoomInfo Technologies Inc. (ZI + $0.49 to $37.17): Calls are outpacing puts ~5:1 as option traders primarily target the July 15th 45.00 call. Volume on this contract is 13,421 versus open interest of 2,296, so we know that the volume primarily represents new positioning. The majority of the transactions on this contract consisted of various-sized blocks that were bought at various times at the ask price of $0.50 each, which suggests bullish intent.

Today’s Bearish Activity    

Shares of LendingTree Inc. (TREE - $4.87 to $50.00) are under pressure this morning after the consumer lending firm lowered guidance last night after the bell due to persistently high inflation and a challenging interest rate environment. The company said that now expects Q2 revenue to come in a range of $259-264M (down from $283-293M) and Q2 adjusted EBITDA to come in a range of $26-29M (down from $35-40M). Option volume is relatively light with the July 15th 90.00 call being the highest volume contract (volume is 10).

Also trading to the downside is CalAmp Corp. (CAMP - $1.79 to $5.39) after the connected intelligence company reported a Q1 loss of $0.10 per share, excluding non-recurring items ($0.07 miss) on revenue that fell 18.8% year-over-year to $64.73M (below the $69.43M expected). In terms of guidance, the company said that while visibility into product shipments still remains uncertain due to global component supply shortages, sequential quarterly revenue growth in the second quarter is expected to be in the “mid to high single digit percentage points.” Calls are outnumbering puts nearly 4:1 with the December 16th 10.00 call leading the way (volume is 60).

 

New 52-week lows (38 new lows today): Denny’s Corp. (DENN + $0.26 to $9.16), Leafly Holdings Inc. (LFLY + $0.30 to $5.46), Seabridge Gold Inc. (SA + $0.31 to $13.27)

Notable Put Activity

Some unusual put activity (~3:1 over calls) is being seen in Arcturus Therapeutics Holdings Inc. (ARCT - $0.90 to $15.11) which is primarily being driven by activity on the July 15th 10.00 put. Volume on this contract is 1,017 versus open interest of 294, so we know that the volume primarily represents new positioning. The bulk of the transactions consisted of various-sized blocks that were being bought at various times for between $0.55-0.65 each, which suggests bearish intent.

Volume Signals

TransMedics Group Inc. (TMDX - $1.30 to $30.59): Option volume is running at nearly 50x the daily average on this medical technology company as option traders primarily target the August 19th 40.00 call. Volume on this contract is 2,557 versus open interest of 2, so it’s likely that the volume represents nearly all new positioning. The bulk of the transactions on this contract consisted of various-sized blocks that were being bought at various times at the ask price of $0.90 each, which suggests bullish intent.

TE Connectivity Ltd. (TEL + $2.49 to $118.07): Option volume is running at nearly 50x the daily average on this maker of sensors and connectors which is primarily being driven by activity on the August 19th 125.00 call. Volume on this contract is 1,452 versus open interest of 2, so it’s likely that the volume represents nearly all new positioning. The bulk of the transactions on this contract consisted of various-sized blocks that were being bought at various times at the ask price of $2.90 each, which suggests bullish intent.

VNET Group Inc. (VNET - $0.01 to $6.24): Option volume is running at over 9x the daily average on this China-based provider of carrier and cloud-neutral internet data center services which is primarily being driven by a 1,999 contract block that was bought on the July 15th 7.00 call for $0.35 when the bid/ask spread was $0.25 x $0.40 (open interest is 808). We know this block is a new position based on the open interest figure and we can assume the intent is bullish in nature since the trade took place above the midpoint of the bid/ask spread.

Gauging Volatility

The Cboe Volatility Index (VIX - 1.73 to 27.32) has been on both sides of the unchanged line today (the intraday range is 27.25-29.72) as equity markets are firmly higher around the mid-day mark (DJI + 656, SPX + 91, COMPX + 272). VIX option volume has been tepid today as the index is currently missing from the “Top Volume by Underlying” list. Today’s options activity has been call-biased (the volume put/call ratio is currently 0.28), with the highest volume contract being the September 21st 85.00 call (volume is 50,303 versus open interest of 68,059).

Interested in receiving notifications of intraday unusual option trades? Follow Schwab’s Managing Director of Trading & Derivatives Randy Frederick on Twitter @RandyAFrederick who will be tweeting unusual options trades as he sees them throughout the day.

What You Can Do Next

  • Schwab clients: Contact a Trading Specialist at 800-435-9050 for questions or log in to the Schwab Learning Center.

  • Not yet a client? Learn more about Schwab Trading Services


  • About the Foundation
    • Foundation
    • Moneywise America
  • Ask Carrie
    • Ask Carrie
    • Planning & Goals
    • Investing Basics
    • Insurance
    • Education Savings
    • Couples and Families
    • Kids and Teens
    • Estate
    • Retirement
    • Major Purchases
    • Banking, Credit & Debt
    • Budgeting & Saving
    • Taxes
    • About Carrie
  • Essentials
  • My Life
  • Teaching Kids
  • Tools and Resources

The information on this website is for educational purposes only. It is not intended to be a substitute for specific individualized tax, legal, or investment planning advice. Where specific advice is necessary or appropriate, consult with a qualified tax advisor, CPA, financial planner, or investment manager.

The Charles Schwab Foundation is a 501(c)(3) nonprofit, private foundation that is not part of Charles Schwab & Co., Inc. or its parent company, The Charles Schwab Corporation.

© 2022 Charles Schwab & Co., Inc. ("Schwab"). All rights reserved. Member SIPC.

(0820-0RM3)