The Federal Energy Information Administration reported on Thursday that U.S. crude oil imports in May rose 7.7% to 9.622 million barrels a day -- the second-highest monthly total since January 2009. This news came after Exxon Mobil Corporation (XOM) reported an analyst-beating profit of $1.60 per share. In fact, XOM's second-quarter earnings jumped 91% from the year-ago period, boosted by higher commodity prices and an increase in refining profits and production.
While the shares initially jumped higher on the news, XOM has since pulled back to support from its 10-day and 20-day moving averages, both of which are located just beneath the $60 level. These short-term trendlines have supported the stock for the past two weeks, during which time XOM has staged a rally. In fact, this duo recently completed a bullish cross, suggesting that XOM may have more fuel in its latest uptrend.
Yet option players are highly skeptical of the shares, as indicated by XOM's Schaeffer's put/call open interest ratio (SOIR) of 0.84, which ranks in the 97th annual percentile. In other words, short-term traders have been more bearishly aligned toward XOM just 3% of the time during the past 12 months.
This skepticism was palpable on Thursday, with the August 57.50 put seeing volume of 6,413 contracts traded -- the majority of which changed hands at the ask price, indicating they were likely bought. Open interest increased significantly overnight, revealing that fresh bearish positions were added at this strike -- which is coincidentally the home of peak put open interest for the August series.
This particular strike called out to back-month traders, too, as roughly 3,600 contracts crossed the tape on the September 57.50 put. Open interest increased by 2,707 contracts overnight, revealing buy-to-open activity at this out-of-the-money strike. In fact, just like the August series, the September 57.50 strike lays claim to the title of peak put open interest for the back-month series.
However, XOM is trading just above the $60 level, so these heavy accumulations of put open interest below the stock's current price could actually serve as a form of options-related support for the energy issue. With XOM poised for a bounce off short-term trendline support, a capitulation by the bears could be the fuel XOM needs to continue its latest ascent.
Discuss this article:
Post your own comment
More articles:
Schaeffer's -- not Fifth Third's, as he was introduced -- Senior Technical Strategist Ryan Detrick gazed into his crystal ball on CNBC this morning, discussing what to expect in September. Historically speaking, September is regarded as a "weak" month, but Ryan revealed that September has actually been very strong in the past five years. read more...
Proving that big corporations are all about second chances, Oracle Corporation (ORCL) on Monday named Mark Hurd as one of its two presidents, as current co-president Charles Phillips is leaving the company. You may remember Mark Hurd from his work as chief executive officer at Hewlett-Packard Company (HPQ) -- or by his tabloid-meriting resignation from HPQ in August. read more...
The Dow Jones Industrial Average (DJIA) has dropped roughly 70 points heading into the latter half of the trading session, as Wall Street deals with renewed concerns about European debt. The Wall Street Journal reported that the region's recent stress tests underestimated some lenders' holdings of government debt. A drop in Germany's manufacturing orders for July is also weighing on sentiment. So far, the DJIA has held support in the 10,350 area, rebounding off this region earlier in the session. However, resistance remains firm in the 10,450 area, which is home to the Dow's 200-day moving average. Finally, the CBOE Market Volatility Index (VIX) is up more than 2%, but remains capped by its 200-day trendline in the 23.50 area. read more...
Aircraft concern BE Aerospace, Inc. (BEAV), remote-connectivity issue LogMeIn, Inc. (LOGM), and beleaguered BlackBerry maker Research In Motion Limited (RIMM) were all on analysts' radar this morning. However, to put today's fresh brokerage attention into perspective, we have to consider each stock's technical and sentiment backdrops. read more...
Earnings are set to roll in from Ciena Corporation (CIEN) on Wednesday, Sept. 8, and analysts are forecasting a loss of 33 cents per share compared to the company's year-ago loss of 5 cents per share. Historically, the firm has had mixed results in the earnings confessional, with the company beating the consensus estimate only twice during the past four quarters. read more...
Nokia Corp. (NOK) is starting the holiday-shortened week off on the right foot. Morgan Stanley upgraded the shares from "underweight" to "overweight," while lifting its price target to 9 euros from 6.50 euros. The broker told clients that recent checks with retailers and suppliers suggest better-than-expected demand and pricing for the upcoming N8 smartphone. The broker said the Finnish phone giant still has plenty to prove, but the risk/reward has now turned positive. read more...
Today's column examines a recent rise in call trading on Goldman Sachs Group (GS) and Silver Wheaton (SLW), as well as a growing affinity for puts on Sprint Nextel Corp. (S). Each day, 3 Stocks to Watch focuses on stocks seeing heavy options trading and gives you a unique insight into each stock's sentiment backdrop. read more...
Mariner Energy (ME) exploded into the headlines on Thursday, as a fire was reported on one of its oil platforms in the Gulf of Mexico. Fortunately, the offshore well was not operating at the time, with no oil in production at the location -- and all 13 crew members on the platform were evacuated without injury. read more...
Electronics manufacturer Flextronics International Ltd. (FLEX), semiconductor sultan Micron Technology, Inc. (MU), and copy-machine king Xerox Corporation (XRX) were all on analysts' radar this morning. However, to put today's fresh brokerage attention into perspective, we have to consider each stock's technical and sentiment backdrops. read more...
The Dow Jones Industrial Average (DJIA) stampeded out of the gate this morning, as bullish investors rushed to buy in the wake of stronger-than-expected August nonfarm payrolls. The blue-chip barometer was quickly pushed into a confrontation with resistance in the 10,450 region and its 200-day moving average, but a weak services index from the Institute for Supply Management (ISM) took some of the fire out of the rally. Currently, the DJIA is up about 70 points and is trading just below 10,400. Elsewhere, the CBOE Market Volatility Index (VIX) has rebounded off its August lows near the 21.50 level, but is still trading down more than 4%. read more...
working... 
