CBOE Volatility Index (VIX) is recently down 1.16 to 19.05, below its 10-day moving average of 22.74, and above its 50-day moving average 18.81.

GameStop Corp. (GME) April 21 and 22 calls are active on call option implied volatility of 42, compared to its 26-week average of 36, according to Track Data. Active call volume suggests traders positioning for larger price movement in Q4 results that are expected to be released on March 24.

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

Analyst Upgrades

• Red Hat (RHT) and American Public (APEI) to outperform from sector perform at RBC Capital.
• KBR (KBR) and Foster Wheeler (FWLT) to buy from neutral at Goldman.
• Bio-Rad (BIO) to outperform from market perform at Leerink.
• Oceaneering (OII) to outperform from neutral at Credit Suisse.
• ASM International (ASMI) and Avid Technology (AVID) to overweight from neutral at JPMorgan.
• Dominion Resources (D) to equal weight from underweight at Morgan Stanley.
• Nationwide Health Properties (NHP) to buy from hold at Jefferies.
• Vivus (VVUS) to buy from underperform at BofA/Merrill.
• Intersil (ISIL) to buy from hold at Canaccord.

Ford (F) reported October U.S. sales were up 19.2% to 157,935 units. November 16 and December 16 calls are active on total option volume of approximately 405,000 calls. November option implied volatility is at 33, December is at 34, January is at 32; below its 26-week average of 39, according to Track Data, suggesting decreasing price risk.

CBOE Volatility Index/VIX is down 1.74% to 19.84.

AMR Corp (AMR) closed up 7%. November option implied volatility is at 55, February is at 53, below its 26-week average of 61, according to Track Data, suggesting decreasing price movement.

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

Analyst Upgrades

• JPMorgan upgraded Smith Micro (SMSI) to overweight from neutral and raised its price target to $15 from $9, citing the release of a WiFi iPad with MiFi from Verizon and Apple.
• Jefferies upgraded Whole Foods (WFMI) to buy from hold and raised its price target to $45 from $36, citing checks that indicate sales are accelerating and the company has been focused on expense control.
• Wells Fargo upgraded Ensco (ESV) and raised its price target to $54 to $56 from $46 to $47, citing valuation, the lifted deepwater drilling ban and higher oil prices.
• Gran Tierra Energy (GTE) was upgraded to buy from hold at Wunderlich, citing the company's Moqueta oil discovery as well as other near-term exploration opportunities, and raised its price target to $12.50 from $7.00.
• Chico's FAS (CHS) was upgraded to buy from hold at KeyBanc and set a $13 price target.
• UR-Energy (URE) was upgraded to buy from hold at KeyBanc.

Analyst Upgrades

• CLSA upgraded Capital One (COF) to outperform from underperform based on valuation and an acceleration in loan growth. The firm raised its price target to $43 from $40.
• KeyBanc upgraded Brush Engineered (BW) to buy from hold based on increased confidence in profit momentum in Specialty Engineered Alloys, valuation and value-added revenue unit growth. The firm has a $30 target on the stock.
• Stifel Nicolaus upgraded Heico (HEI) to buy from hold with a $42 target, citing the better-than-expected Q3 results.
• Greenbrier (GBX) was upgraded to buy from hold at BB&T.
• Paychex (PAYX) was upgraded to hold from sell at Deutsche Bank.
• A. Schulman (SHLM) was upgraded to buy from neutral at Longbow.

Amex Energy Select (XLK) closed up 46 cents to $22.38. Crude oil futures closed up 3.18% to $81.46 according to Bloomberg. XLE August put option implied volatility is at 24, September is at 26; above its six-month average of 28 according to Track Data, suggesting non-directional price movement.

CBOE Volatility Index-VIX is recently down 1.51 to 21.99; S&P 500 up 2.19%.

Option volume leaders today: Pfizer (PFE), Citigroup, Inc. (C), Baidu, Inc. (BIDU), Apple, Inc. (AAPL).

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

Stocks were set to close almost at the highs of the trading day based upon a continued hope of solid earnings and a mixed housing market picture. Expected news also drove anticipations for the week.

Here were today's unofficial closing bell levels:

Dow Jones 10,525.43 +100.81 (0.97%)
S&P 500 1,115.01 +12.35 (1.12%)
Nasdaq 2,296.43 +26.96 (1.19%)

Top Analyst Calls

Analyst Upgrades

• Berstein upgraded Diamond Offshore (DO) to market perform from underperform based on valuation. The firm has a $69 price target on the stock.
• Jefferies upgraded Patterson-UTI Energy (PTEN) to buy from hold, citing leverage to higher land rig pricing. The firm raised its price target to $21 from $17.
• Wunderlich upgraded Renasant (RNST) to buy from hold following the company's acquisition of Crescent Bank. The firm raised its target for shares to $20 from $15.
• AT&T (T) was upgraded to buy from hold at Deutsche Bank.
• Blackstone (BX) was upgraded to buy from neutral at BofA/Merrill.
• Scripps Networks (SNI) was upgraded to overweight from equal weight at Morgan Stanley.

Put volume surged on CBOE Holdings (CBOE) Tuesday, with nearly 7,200 of these bearishly oriented options crossing the tape. This flurry of activity represented about seven times the stock's expected daily put volume. Meanwhile, fewer than 1,700 calls were exchanged during the course of Tuesday's trading.

The day's most popular strike, by far, was CBOE's July 30 put. No fewer than 6,443 contracts traded at this strike, with 83% changing hands at the ask price -- indicating they were most likely purchased. Implied volatility rose 7.2 percentage points by the close, and open interest at this strike swelled overnight by 3,175 contracts. In other words, it's a safe bet that new bearish positions were added at the July 30 put on Tuesday.

Despite a fairly tame PPI reading, stocks were directionless today and whether the markets were red or black was not going to be set literally until the final minutes. BP plc (BP) recovered and kept oil shares from getting too far out of hand.

Here were today's closing bell levels:

Dow 10,409.46 +4.69 (0.05%)
S&P 500 1,114.60 -0.63 (-0.06%)
Nasdaq 2,305.93 +0.05 (0.00%)

Top Analyst Calls

BP PLC (BP) is recently up $1.03 to $31.70 in pre-open trading. BP debt rating was cut to two levels above junk by Fitch Ratings. BP June 31 straddle is priced at $3.20, October is at $11.50. Overall option implied volatility of 84 is above its 26-week average of 40 according to Track Data, suggesting larger price movement.

Goldman Sachs (GS) closed at $133.74. GS overall option implied volatility of 43 is above its 26-week average of 40, according to Track Data suggesting slightly larger near term price movement.

CBOE Holdings (CBOE) initial public offering of at least 11.7 million shares were priced at $29.

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

Amex Energy Select (XLE) is recently up 41 cents to $50.94 in pre-open trading. Crude oil futures are recently down 0.43% to $72.27 according to Bloomberg. XLE overall option implied volatility of 35 above its 26-week average of 28 according to Track Data, suggesting larger price movement.

Chicago Board of Options (CBOE) reported May 2010 average daily volume (ADV) of 6.6M contracts was an all-time record.

Stocks with implied volatility increases from June 1st; BP Plc (BP), Anadarko Petroleum (APC), Halliburton (HAL).

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

Over the past two weeks, the U.S. dollar has shot upward as the euro crumbled to $1.28. Usually, this scenario brings gold to it knees. Gold and the U.S. dollar often move in opposite directions: when the dollar is up, gold drops.

However, this hasn't happened. Gold has been holding steady and Thursday shot up to $1,185 per ounce. With unprecedented selling of the euro, much of that money went into the U.S. dollar. Now, investors are turning to gold as a hedge during the European debt crisis.

Do you trade gold options? Do you trade S&P options? Are you trading long term options (LEAPs?) If you do, you would be using the Chicago Board of Options Exchange (CBOE).

The CBOE may be following in the footsteps of the Chicago Board of Trade (CBOT), the International Stock Exchange (ISE) and the New York Mercantile Exchange (NYMEX), which have all gone public, The Financial Times cites sources.

CME Group, Inc. (CME) announced it has entered into a seven-year license agreement with the Chicago Board Options Exchange that will allow CME Group to list futures and options on futures for volatility indexes on a variety of asset classes. These contracts will be listed with, and subject to, the rules and regulations of the particular exchange where the products will be traded.

CBOE Volatility Index: The VIX was down 1.38 to 17.34.

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