Friday, November 13, 2009

First Solar Option Maximum Pain at $135.00 Strike (FSLR)

A reader had emailed a comment regarding yesterday's post "Looking For an Uptick in First Solar (FSLR)". At the time of the post the stock was at $115.68, thirty-one cents from the closing price of $115.37. The reader wanted to know if the stock had a shot at the Nov. expiration MaxPain strike.
Short answer: NO.
For those who are unfamiliar with the concept, here's a max pain chart for FSLR at OptionPain.
(enter the symbol and hit submit)

The concept can throw out gibberish if the stock has had a dramatic gap move since the last expiration, as FSLR did on earnings release date, Oct. 29.

Max pain is related to options "pinning" where the stock settles near (within pennies of) a strike price on expiration day.
[he knows expiration is actually the next day, ask him about the friend who cleared BSC and got a call from Ace Greenberg: "Where's my fucking ten million dollars?". Close those positions if you don't want them exercised. -ed]

Eyeballing the chart, $120 looks as if it might offer some resistance. The stock is currently up $4.03 at $119.40, close enough for me.

Via BigCharts: