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GOOG Skew is Flat

GOOGLE announced earingis on Monday and blew the doors off.  Then after breaking the AAPL strong hold on highest market cap stock it has since completely died.  What is interesting is how option traders are playing the move.  Take a look at the skew curve in GOOG options in Feb and March ordinary:

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Content is King Another CHEAP STRADDLE

So far this earnings cycle we have seen big wins in tech out of GOOG, NFLX, and no AMZN.  Flops have come from AAPL, IBM, and MSFT.  Take a look at the pricing of AMZN from today (now up about double the straddle price).

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GOOG volatility is too cheap into earnings

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GOOG is about to declare earnings and this is the cheapest I have seen the ATM options in as long as I can remember into a cycle.  The key to GOOG is how it trades through the earnings.  Most of the time the move in a direction will keep going allowing the  ATM the day before earnings to go deep in the  money.

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AMZN a Whale, GOOGL a Fail

On the heals of last nights complete and utter annihalation of the FB straddle I thought it would be interesting to follow a few of the other big earnings plays.  AMZN,  which had a straddle that was below the average straddle price over the last year,  saw its straddle go out 23 dollars.  As I write this the stock is up 36 dollars from the close, and really, if one was trading the straddle this morning,  the 300.00 straddle went out a massive 24 dollar winner, a full 100% return on the straddle bet.  Increadible.  

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What is up with WAG?

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Step into the Wednesday time machine and not much happened between then and today.  Traders have been so lulled into a stupor with the lack of movement that they bid volatility up to 15% yesterday when it looked like there was another crisis brewing.  As of today no crisis, as holders of GOOG and other earnings reporters rejoice in the upside surprises.

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Cage match in the NDX

Stocks briefly flirted with new highs today, but look like they will close up for the day.  Slightly better housing news with a non-reaction to Thailand or Ukrainian violence also got the VIX to a 12 close.  I am not saying stocks can't drop, but the case for up to flat is getting better.  Part of the VIX is to forecast volatility in the future and for now there isn't any.

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Old tech is new again

One of the most interesting things as the quarter pulls to a close is to see where the money is going today.  It is not going to NFLX, GOOG and FB.  After taking a good pasting the last couple of weeks, the darling stocks have not been able to get up off the mat.  They are still up a bit since January, but definitely off of the nosebleed levels of a few weeks ago.

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Someone called the top in the growth stocks

Following up on Friday’s action we did get a little pull back in the index skew today.  VIX is in a touch and most of the vol. ETP’s might be even or down a touch with the market rolling in down .3%.    There still feels like something is brewing out there, but I cannot put my finger on it.  Gold is getting trounced since Ms. Yellen is looking more hawkish than dovish.  Who knew?  T-bonds are still clinging to some near term highs and that always gives me the heeby geebies until the shoe drops.

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