Schaeffer's Daily Market Blog Features NVIDIA, Intel, Pfizer, Peabody Energy, and Arch Coal.

CINCINNATI -- Among the stocks featured in the May 11 edition of Schaeffer's Market Blog are NVIDIA (NASDAQ:NVDA), Intel (NASDAQ:INTC), Pfizer (NYSE:PFE), Peabody Energy (NYSE:BTU), and Arch Coal (NYSE:ACI). Schaeffer's Market Blog is just one of the many free market commentaries written everyday at www.SchaeffersResearch.com - the home of Bernie Schaeffer and Schaeffer's Investment Research. The Market Blog is written throughout every trading day by Schaeffer's financial analysts and traders. They are quick insights to the day's most notable market activity from an options perspective. For additional information about this report or to have it delivered to you free via email every day click on the following link. http://www.schaeffersresearch.com/redirect.aspx?CODE=PROB12M&PAGE=1 .

Schaeffer's Market Blog for Thursday, May 11, 2006:

Below are just a few of today's Market Blog entries. Click here to read all of today's Market Blog. http://www.schaeffersresearch.com/redirect.aspx?CODE=PROB1C&PAGE=1 .

9:00 PM Options Podcast

If you're interested in options, try our new Options Update podcast. It's a brief daily summary of the most-active options. To see the full menu of podcasts, please visit http://www.schaeffersresearch.com/commentary/podcasts/. Podcasts are audio presentations that you can play on your computer or download from Apple's iTunes Music Store to play on a portable device such as an iPod.

11:43 AM NVIDIA Trades Actively in the Options Pits

Options in NVIDIA (NASDAQ:NVDA) are trading briskly this morning. In particular, the May 27.50 put (UVA QY) has already seen volume of nearly 14,000 contracts. Open interest when trading began was 33,570 contracts. Nearly all of the volume comprised blocks smaller than 1,000 contracts, but two blocks of 4,000 contracts crossed the tape at about 9:51 a.m. Eastern time on the American Stock Exchange, and were marked as a spread. The first crossed at 50 cents, when the bid price was 50 cents and the ask was 60 cents, so these contracts might have been sold. There was a degree of volatility in the bid and ask prices and the second transaction went off at 45 cents, when the bid fluctuated between 50 cents and 55 cents and the ask was 60 cents, again suggesting that the contracts were most likely sold.

At last check, NVDA was trading at $28.60. On our Schaeffer's Equity Scorecard, the stock earns 8.0 out of 10, suggesting that the path of least resistance lies to the upside. I notice that Bernie holds it in the Schaeffer's Master Portfolio. Zacks reports that 15 of the 18 covering analysts award the stock a "hold" rating or worse, leaving plenty of room for upgrades. The Schaeffer's put/call open interest ratio (SOIR) for NVDA is 1.55, higher than 88 percent of readings taken during the past year. Such pessimistic sentiment in the options pits is a good sign from our contrarian perspective, indicating that sideline money might be plentiful. The stock rose this month to the highest level we have seen since February 2002. During the past year, NVDA has not closed a week below its 20-week moving average. It currently enjoys strong support from its 10-week moving average.

1:41 PM Intel Calls

I've talked about this before, and I'll talk about it again. Despite Intel's (NASDAQ:INTC) continued underperformance, options players seem to want to will the stock higher and are still buying calls options on the equity. With the stock down over one percent today, and the broader market getting smacked (the Dow is currently down 136 points), Intel has seen call volume outpace put volume by a ratio of more than three-to-one. I expect this issue to continue to show price weakness.

2:53 PM Pfizer's Chantix Receives FDA Approval

Earlier today, the Food and Drug Administration (FDA) announced the approval of Pfizer's (NYSE:PFE) smoking-cessation pill Chantix. This approval is the first for a product of its sort in nearly a decade. Chantix is different from other anti-smoking products as it does not contain nicotine. The drug works by mimicking some of nicotine's effects in the brain in order to stem the ever-dreaded "nicotine fits." Moreover, if the rehabbing smoker gives in, the drug will help block the pleasurable sensations associated with nicotine. Chantix will be available only by prescription and has been approved to be taken for 12 straight weeks. The treatment can be re-prescribed for an additional 12 weeks if needed. The FDA approval did not come as a surprise.

2:53 PM Coal Manages to Gain in Down Market

Today is pretty ugly, plain and simple. I guess it took most traders a day to realize that the Fed said they aren't done raising rates - because today's selling is very intense and isn't a mistake. The volume today is set to be pretty big and the internals lean strongly to the downside. Looks like the only thing stopping this selling will be the closing bell. Still, if you look hard enough there is always a sector or two that can buck the trend, and today that appears to be coal. Although other energy names are down a little bit, coal is simply rocking. As I wrote in this observation, coal is an area that I like and would continue to add on any pullbacks. The only problem is I haven't seen too many pullbacks the past few weeks to add - they've simply gone vertical. Looking at two of the larger names in the group, Peabody Energy (NYSE:BTU) is up over five percent to a new high and Arch Coal (NYSE:ACI) is up over a percent to a new high as well.

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About Schaeffer's Investment Research (www.SchaeffersResearch.com)

Schaeffer's Investment Research, founded by Bernie Schaeffer in 1981, is a financial information and trading resources company. It publishes Bernie Schaeffer's Option Advisor, the nation's leading options subscription newsletter. The firm's contrarian approach focuses on stocks with technical and fundamental trends that run counter to investor expectations. The firm's website, http://www.SchaeffersResearch.com , is recognized as one of the leading information sources for stock and options traders and was cited as the top options website by both Forbes and Barron's. Click here for more details about Schaeffer's trading methodology: http://www.SchaeffersResearch.com/method .