Jolly good news from across-the-pond was (drum roll, please) was announced at Lloyds Bank (LYG) overnight, providing an early boost in confidence and an attempt at rallying market prices as well.
The British equivalent of the US’s government-indentured Citigroup (C) stated it expects to post a profit this year on improved trading prowess and lighter-than-expected provisions for bad and once toxic assets. Intraday, LYG is up 8% at $3.70.
For a less impressionable stateside bull, rekindled worries of the Greek-based saga pitting Aphrodite style cheers vs Medusa type fears on a near daily basis have cropped up once more. Friday’s story telling finds increased signs of European indecision and the possibility of a needed IMF bailout if leaders from the EU fail to agree on terms for a deal next week.
In those sometimes intertwined markets, the US Dollar (UUP) is taking its cue from the discord over what to do about Greece’s debt by jumping to fresh two week highs on a safe-haven bid. At the same time, the Euro (EUR/USD) is sinking by an equally strong 0.77%.
The slightly beefed up panic however hasn’t worked its bewitching magic on the likes of that sometimes other convenient safe haven play called Comex Gold (GLD). Intraday and much like its more optimistic-minded commodity brethren (USO, SLX, GDX, XLB and KOL); GLD is shedding a middle of the pack 1.70%.
In those sometimes accurate heat-seeking option markets, quadruple witching and index rebalancing add up to a bunch of false reads or conclusions of just what the other program is positioning for. That said, one interesting looking position has occurred in Delta (DAL) this morning. A handful of block prints totaling 7,000 ATM September 13 puts hit the tap for $2.00.
Versus open interest of 4,000 we can assume the initiating party(s) is opening. The question of buying versus selling and whether stock is involved is a bit more difficult to know for sure. Some analysts have voiced the opinion the airlines have enjoyed a nice flight since initially taking off back in late November.
Technically speaking, with DAL currently consolidating around prior key highs set back in January 2009 while finding pattern support off the 50-SMA, a bull long shares could simply be acting proactively by locking in profits at $11, in case of an emergency landing. Another scenario is a buyer could be a straight-up bear sensing a hijacking of sorts in-the-making.
Chris Tyler
Senior Staff Writer & Options Strategist
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The information offered here is based upon Christopher Tyler’s observations and strictly intended for educational purposes only, the use of which is the responsibility of the individual.
