Barnes & Noble (BKS) April put option volatility is at 64, July is at 61, above its 26-week average of 49, according to Track Data, suggesting larger price movement.

CBOE Volatility Index (VIX) is up 20% to an eight-month high; S&P 500 closed down 1.87%.

Volatility Monitor: CBOE DJ Industrial Average Index (DJX) is up 3.2% to 21.8.

NASDAQ (NDX) is up 3.4% to 26.7; S&P 100 Index (OEX) is up 3.3% to 23.7, according to IVolatility.

Options Update is by Stock Specialist Paul Foster of theflyonthewall.com.

iShares MSCI Japan Index Fund (EWJ) closed down 0.2% after selling off 11% in early morning trading on Japan radiation leak concerns. April put option implied volatility of 44 is above its six-month average of 21, according to Track Data, suggesting larger price movement.

CBOE Volatility Index-VIX is up 15.1% to 24.32 on 662,000 call contracts, 319,000 puts.

Options Update is by Stock Specialist Paul Foster of theflyonthewall.com.

Chesapeake Energy (CHK) announced it has agreed to sell approximately 487,000 net acres of leasehold and producing natural gas properties in the Fayetteville Shale play to BHP Billiton (BHP) for $4.75 billion in cash before certain deductions and standard closing adjustments. Chesapeake Energy overall option implied volatility of 34 is near its 26-week average, according to Track Data, suggesting non-directional price movement.

CBOE Volatility Index (VIX) was up 27% to 20.94.

Options Update is by stock specialist Paul Foster of theflyonthewall.com.

CBOE Volatility Index (VIX) rises 24% to 20.03 on antigovernment protests in Egypt.

United States Oil Fund (USO) closed up 4.3% as WTI Crude futures have traded up 4.37% to $89.38, according to Bloomberg. Traders were focused on short-term February 38 calls. February put option implied volatility of 29 is below its 26-week average of 31 according to Track Data, suggesting decreasing price movement.

Option volume leaders are Apple (AAPL), Citigroup (C), Amazon.com (AMZN) and Netflix (NFLX), according to Track Data.

Options Update is by Stock Specialist Paul Foster of theflyonthewall.com.

eBay (EBAY) January 29 and 30 puts are active on flat volatility with total call volume of 37K contracts compared to 103K puts, according to Track Data. The increase in trading of the January 29 and 30 puts suggest traders anticipate movement into its Q4 January 19 EPS report.

BMO Financial Group (BMO) announced that it will acquire all outstanding shares of common stock of Marshall & Ilsley (MI) in a stock-for-stock transaction. Under the terms of the agreement, each outstanding share of M&I will be exchanged for 0.1257 shares of Bank of Montreal upon closing. BMO Financial Group overall option implied volatility of 21 is below its 26-week average of 27, according to Track Data, suggesting decreasing price movement.

CBOE Volatility Index (VIX) traded down 10% to at intra-day low of 15.46, an eight-month low.

Options Update is by Stock Specialist Paul Foster of theflyonthewall.com.

Massey Energy (MEE) closed up $4.80 to $46.94 on reports that Alpha Natural (ANR) may buy the company, DJ says. December and January 55 calls are active on total call volume of 58K contracts, compared to put volume of 23K puts. November call option implied volatility is at 53 and January is at 48, compared to its 26-week average of 52. Increasing option volume suggests traders are positioning for price movement.

CBOE Volatility Index (VIX) closed down 29 cents to $18.23, near a six-month low after EPS, elections, FOMC meeting and October employment report.

CBOE option volume leaders today: Bank of America (BAC), Las Vegas Sands (LVS) JPMorgan (JPM) and Citigroup (C).

Options Update is by Stock Specialist Paul Foster of theflyonthewall.com.

Campbell Soup (CPB) is expected to report Q3 EPS on May 24. June put option implied volatility is at 26, August at 25, November is at 26, above its 26-week average of 20, according to Track Data, suggesting larger price movement.

MSCI Spain Index ETF (EWP) closed at $34.30. The IBEX 35 Index is recently down 2.29%. EWP overall option implied volatility of 49 is above its 26-week average of 31, according to Track Data, suggesting larger price movement.

CBOE Volatility Index (VIX) is at 35.31; 50-day is at 20.57.

Options Update is by Stock Specialist Paul Foster of theflyonthewall.com.

Honeywell (HON) closed at $45.27 after HON said, "The strong productivity actions taken last year are continuing to benefit the company, and along with improving economic conditions, we now expect our earnings to be near the high-end of our full-year guidance range of $2.20 – 2.40." The 2010 consensus EPS estimate is $2.40. April put option implied volatility is at 21, May and June is at 24, September is at 27; verses its 26-week average of 28 according to Track Data, suggesting decreasing near-term price movement.

Three stocks with IV rise on March 31; Liberty Property Trust (LRY) +3%, Arena Pharma (ARNA) +7%, Garmin (GRMN) +5% according to IVolatility.

CBOE Volatility Index-VIX at 17.59; 10-day moving average is 17.28, 50-day is 20.53, 200-day moving average is 23.26.

Update is by Stock Specialist Paul Foster of theflyonthewall.com

Kraft Foods (KFT) said it has agreed to acquire Cadbury (CBY) for 11.9 billion pounds or $19.5 billion. Kraft said it will pay 500 pence and 0.1874 of its own shares for every Cadbury share, or the equivalent of roughly 840 pence a share in total. In addition, Cadbury holders will receive a dividend of 10 pence a share. February call option implied volatility is at 35, March call volatility is at 31, versus its 26-week average of 26, according to Track Data, suggesting larger price movement.

CBOE Volatility Index (VIX) at 17.90; 10-day moving average is 18.49.

Option Update is provided by Stock Specialist Paul Foster of theflyonthewall.com.

SPDR Gold Shares (GLD) is recently up $1.26 to $108.60. Gold is also up 11% to $1,108.60 according to Bloomberg. GLD January and February option implied volatility of 24 is near its 26-week average of 25, according to Track Data, suggesting non-directional price movement.

Clearwire (CLWR) a provider of 4G service called Clear, closed at $6.79. CLWR January option implied volatility is at 73, March at 68; near its 26-week average of 67 according to Track Data, suggesting non-directional price movement.

CBOE Volatility Index-VIX at 22.51; 10-day moving average is 21.93.

Option Update is provided by Stock Specialist Paul Foster of theflyonthewall.com.

The struggle between the bulls and bears continued on Friday with what appeared to be a victory for the bears. And, long-term, they do have the edge since there is little doubt that every major index is still pointing south.

Friday's close at 8,001 on the Dow surely got the bulls' attention, as 8,000 appears to have some psychological importance to the investing public. But it has little technical significance.

The support line that has held since November (with the exception of the bear trap of Nov. 20 and Nov. 21) is actually at around 7,940. And the numbers that most technicians refer to as "the" market's support is at the zone between S&P 500 800 and 820.

For guidance at crucial moments, I prefer to check out the most reliable internal and sentiment indicators.

Stocks advanced for the fourth day for the best sustained performance this year, but as I read the after-market reports you would think that the apocalypse was just around the corner.

There were comments like "no evidence to support that view," referring to world banks' success in reviving economies.

Or how about, "The bottom line is, earnings are dwindling. And it's a lot worse than it looks, when you look year to year." Or, "Obviously the news background is favorable today, but this is just another rally in a bear market."

With all of the gloom and doom, here are a few facts to ponder: