A trader bought 2,323 DISCA Jan 75 Puts for $0.55 (5.3 times usual volume) with stock at $85.13
A trader bought 10,000 DNDN 1×2 Put Spreads for $0.25 (2.2 times usual volume) with stock at $2.88
A trader bought 2,000 KMR Jan 75 Calls for $1.85 (13.4 times usual volume) with stock at $75.69
A trader bought 2,000 IBB Jan 220 Calls for $4.70 (3.1 times usual volume) with stock at $213.55
A trader bought 3,100 WTI Dec 20 Calls for $0.45 (12.8 times usual volume) with stock at $19.10

A trader bought 5,500 CWH Jan 30 Calls for $0.10 (3.2 times usual volume) with stock at $23.65
A trader bought 2,000 KMR Jan 75 Calls for $1.85 (13.4 times usual volume) with stock at $75.69
A trader bought 2,000 IBB Jan 220 Calls for $4.70 (3.1 times usual volume) with stock at $213.55
A trader bought 3,100 WTI Dec 20 Calls for $0.45 (12.8 times usual volume) with stock at $19.10

A trader bought 1,800 TIP Jun 112 Puts for $3.90 (17.7 times usual volume) with stock at $110.99
A trader bought 1,167 UBNT Dec 41 Puts for $1.40 (3.1 times usual volume) with stock at $43.40
A trader bought 2,800 LEAP Jan 2015 12 Puts for $0.25 (3.4 times usual volume) with stock at $16.48
A trader bought 2,323 DISCA Jan 75 Puts for $0.55 (5.3 times usual volume) with stock at $85.13
A trader bought 10,000 DNDN 1×2 Put Spreads for $0.25 (2.2 times usual volume) with stock at $2.88

TODAY THE WORLD CHANGED—DID YOU NOTICE?

Sometimes earth shattering happenings are (in newspaper talk) buried below the fold. That is, they are not recognized for their world-changing importance. This will undoubtedly be the case today. One story will receive far less coverage than a murder in Kansas or a carjacking in Oregon. But, in terms of importance, today could rank up there with the day TARP was rejected, the day that TARP passed, or the day that a Republican Supreme Court Justice voted to uphold Obamacare.

Today, the news broke that the US Senate changed its rules. Sounds boring, right? No it definitely is not.   Rather, today’s Senate action is clearly one of the most important occurrences of this decade.

From now on, all federal executive and judicial appointments (except for Supreme Court nominees) can move forward with only 51 Senate votes.  Yesterday that number was 60—a big difference from 51.  But, after today, President Obama–and all of his successors, both R’s and D’s—will find it vastly easier to have their appointments approved.

This Senate rule change is a sign of the times.  As Sentor Reid pointed out, Presidential appointments have been blocked 168 times in US history. Half of these have occurred with Obama as President.  It is part of the R’s “block and cause trouble” strategy, designed to frustrate Obama’s programs.  But that strategy has now led to the rule change, and our country (for better of for worse) will never be the same again.

While the direct effect of the rule change is to make the appointment process easier, there are other—equally important—consequences down the road.

1.  If Janet Yellen’s confirmation had ever been in doubt, it is no longer.

2.  While legislation and Supreme Court appointments still need 60 votes to proceed, THE PRECEDENT HAS BEEN SET.  In the future, if Supreme Court candidates or important legislation is frustrated by a Senate minority, further rule changes can be made to allow for majority control—whether that majority be D as it is now, or R in the future.

Think of what this would have meant in 2008-2009.  The Democratically controlled House passed substantial environmental and social justice legislation.  Because of the 60 vote requirement, most of these did not pass the Senate.  If there was only a 51 vote requirement, many of these social justice programs would likely have become law.

Similarly, in 2004, Republicans controlled both the White House and Senate.  Many conservative measures were not pushed hard nor enacted because the 60 vote barrier was impossible to overcome.

In the future, either party will feel freer to change the rules, and eliminate the 60 vote barrier to legislation.

3.  Importantly, the Senate rule change also does not bode well for the upcoming Budget talks and debt ceiling showdowns.  If there was animosity before, the Senate vote will ratch it up another notch—or maybe 2 or 3.  Hopes for a small bargain, or perhaps even a grand bargain, have just taken a big hit.

In sum, the Senate rule change is really important.  So read about it and try to understand how it could effect your portfolio.  For it is clearly one of the most momentous occurrences so far this decade.

Follow me on Twitter @USKOTM.

Pandora Media, Inc (P) is streaming internet radio station in the United States with over 125 million registered users. Shares of P are currently trading around $20.05 in a 52 week range of $7.40-$31.94. The stock has had a great year adding over 216% to share prices year to date. P is set to report their most recent quarterly earnings report today after the market close. Historically P has been relatively weak on earnings day. Over the past 8 quarters the stock has sold off 5 times on earnings day and rallied 3 times with an average move of 14.2%. On a chart however, P is trading relatively well. Shares are trading just off their 52 week high and well above the Ichimoku Cloud. The future cloud is also upward sloping indicating there can be more upside in store for P. Options order flow has also been relatively bullish in P. On Tuesday a trader sold of the Nov 22^nd 26 puts for $0.65 indicating a strong belief that the stock will close above $26.00 on tomorrow’s expiration. With activity like this and a stong chart we believe P sets up well for a long ahead of earnings. With the options market currently implying a target of $32.15 for tomorrow’s close we will look to set up a trade at that level. (more…)

A trader bought 1,300 GA Dec 10 Calls for $0.30 (3 times usual volume) with stock at $9.23
A trader bought 2,758 FWLT Jan 31 Calls for $0.54 (3.2 times usual volume) with stock at $28.87
A trader bought 1,900 OLN Jan 25 Calls for $0.75 (3 times usual volume) with stock at $24.65
A trader bought 2,000 ARO Apr 12 Calls for $0.70 (2.4 times usual volume) with stock at $10.12
A trader bought 2,400 OI Feb 35 Calls for $0.95 (4 times usual volume) with stock at $32.93

A trader bought 2,500 GAME Dec 5 Puts for $1.10 (10.8 times usual volume) with stock at $4.10
A trader bought 5,000 ATVI Dec 15 Puts for $0.10 (4.6 times usual volume) with stock at $16.94
A trader bought 1,350 KBR Jan 34 Puts for $1.54 (3.5 times usual volume) with stock at $33.84
A trader bought 3,000 PVA Mar 7.5 Puts for $0.30 (3.3 times usual volume) with stock at $10.63

A trader bought 1,300 GA Dec 10 Calls for $0.30 (3 times usual volume) with stock at $9.23
A trader bought 2,758 FWLT Jan 31 Calls for $0.54 (3.2 times usual volume) with stock at $28.87
A trader bought 1,900 OLN Jan 25 Calls for $0.75 (3 times usual volume) with stock at $24.65
A trader bought 1,350 KBR Jan 34 Puts for $1.54 (3.5 times usual volume) with stock at $33.84
A trader bought 3,000 PVA Mar 7.5 Puts for $0.30 (3.3 times usual volume) with stock at $10.63

VirnetX Holding Corporation (VHC) is a company involved in the commercializing of portfolio patents. The company’s stock is currently trading around $19.30 in a 52 week range of $16.10-$36.84. The stock has been very weak this year with shares falling nearly 34% year to date.  Options activity in VHC suggests that traders believe this weakness will continue through the first half of next year. Earlier in today’s trading session a trader sold 9,000 Jan 2015 18 strike calls and bought 9,000 Jun 2014 25 puts for a $6.80 total debit.  This is very bearish trade that expresses this trader’s view on further downside in VHC next year. This block also traded at volume that represents 10.2 times the average daily option volume in VHC.  The chart is looking weak as well. Shares of VHC are primed to break the cloud to the downside, a key technical level that shares could tumble from if broken. We believe that both the technical and the order flow justify a long term trade in VHC to the short side. We will look for a setup more in line with our risk tolerance unlike the trade the block trader executed. We do not want any risk of blowing out. (more…)

Fifth Third Bancorp (FITB) is a financial services company with over $115 billion in assets and 1,316 banking centers throughout the Midwest United States. The company’s stock is currently trading around $20.05 in a 52 week range of $14.05-$20.21. The stock has had a great year adding nearly 32% to share prices year to date. On a chart the stock is trading well above the Ichimoku Cloud and is just off of its 52 week highs. The stock does appear to be consolidating however and the future cloud is in a region that appears to relatively neutral. Action in the options market suggests that traders believe this sideways action will continue in FITB as we have seen large sellers of straddles come in the market. Early this morning a trader sold 6,000 FITB Dec 20 straddles for $0.67. This block represents volume that is 6.4 times the average daily option volume in FITB. Short straddles are incredibly risky so we know that this trader has a relatively high level of conviction. We believe that the price action and order flow in FITB confirms the stock will be in a period of consolidation in the short term. We want to take advantage of this but do not have the risk tolerance for short straddles. Instead will use a strategy that will have us short premium and implied volatility but won’t carry the blowout risk of a short straddle. (more…)