SPECIAL DISCOUNTED MEMBERSHIP RATES UNTIL JUNE 30, 2010

Options Activity for Thursday, June 24, 2010

Options speculators have stepped up their bearish bets on MEMC Electronic Materials, Inc. (WFR) lately, according to data from the International Securities Exchange (ISE) and Chicago Board Options Exchange (CBOE). During the past two weeks on the exchanges, the stock has racked up a put/call volume ratio of 0.59, in the 93rd annual percentile. In other words, options players on the ISE and CBOE have bought to open WFR puts over calls at a faster pace only 7% of the time during the past year.

At last check, the shares of WFR have extended their year-to-date deficit of more than 18%, giving up 3.8% to explore the $10.70 neighborhood.

The shares of Hornbeck Offshore Services, Inc. (HOS) have ticked lower in recent sessions, after the Obama Administration vowed to quickly appeal a federal judge's decision to block a six-month moratorium on offshore drilling in the Gulf of Mexico. In light of the stock's retreat, it appears a handful of once-bullish option traders may be throwing in the towel on their short-term bets.

During the course of Wednesday's session, HOS saw more than 1,100 calls cross the tape – almost doubling its expected daily volume of fewer than 600 contracts. The July 15 and 17.50 calls were most active, with roughly 400 contracts exchanged at each strike. However, most of the calls traded at the bid price, and call open interest at the front-month strikes depleted overnight, pointing to liquidations.

What's more, HOS could exacerbate its year-to-date slide of more than 35%, should a bevy of brokerage firms also exit the bullpen. According to Zacks, the stock still harbors six "buy" or better ratings, compared to three lukewarm "holds" and not a single "sell," leaving the door wide open for potential downgrades.

Unlike much of the broad market, Chipotle Mexican Grill, Inc. (CMG) has been on a roll lately, ascending steadily along the support of its 10-week and 20-week trend lines. In fact, in the last 60 days, the burrito king has outperformed the broader S&P 500 Index (SPX) by an impressive 38%.

Interestingly enough, puts have been option players' preference lately, as evidenced by the stock's International Securities Exchange (ISE) 10-day put/call volume ratio of 2.02, which ranks above 80% of all other readings taken during the last year.

However, Wednesday's put activity reveals that traders were opening in-the-money puts. For example, 1,181 contracts changed hands on the July 165 put, while the July 160 put saw volume of 1,082 contracts traded. The majority of these puts traded closer to the ask price, and open interest at each strike increased overnight. With CMG currently trading around $146.89, these 160 and 165-strike puts are comfortably in the money.

So make the most of what the market has to offer, start trading options.