At 10:28 AM EST we have SIRIUS stock up 6.5% at $1.40 on literally 92.5 million shares.

The average volume is about 58 million shares and the 52-week trading range is $0.56 to $1.61.

The last day that we saw 100+ million shares trade was on November 4 with 185 million.  On October 13 there were 156 million shares traded, and we saw more than 100 million shares on October 5 and October 1.

JON C. OGG

Alcoa, Inc. (NYSE: AA) was a mystery. It traded almost its entire open interest in the NOV $13 and $14 CALLS on Friday with more than 55,000 contracts traded just between the two contracts.  Shares rose nearly 4% to $13.14 and the 39+ million shares came to more than 150% of normal share volume.

Brocade Communications Systems, Inc. (NASDAQ: BRCD) saw its stock rise 3% Friday to $6.35 and volume more than doubled to over 35 million shares.  There were more than 19,000 PUTS that traded and a whopping 58,000+ CALLS that traded hands.  As we have covered before at 247WallSt and here, this continues to be takeover speculation.

Halliburton Company (NYSE: HAL) continues to see very active PUT and CALL volume trading as investors, traders, and speculators are trading in out-of-the-money contracts merely for upside and downside exposure if the Deepwater Horizon disaster comes back on it or not after the findings hit the stock so hard this last week.  Nothing specific here, but no resolution is there either and this will remain a highly volatile name ahead.

VIVUS Inc. (NASDAQ: VVUS) was no shock to see on the options volume explosion list.  However, more than 22,000 PUT contracts traded and more than 71,000 CALL contracts traded.  We covered the news and gave analysis in depth over at BioHealthInvestor.com and it seems as though the thought will be an approval is still possible despite the FDA initial denial.  Options in December and January will be the real hurdle months ahead.   A 26% gain to $7.75 was on more than 27 million shares, more than 8-times normal trading volume in the shares.

The United States Natural Gas (NYSE: UNG) may be perhaps one of the worst ETFs created due to performance and time erosion as futures contracts and the roll dates would force this to drift to zero if the nat-gas market went static and saw little price changes.  So, when you see 24,073 of the DEC-2010 $7 CALLS trade on a day when the shares are at $5.82 and low volume, you have to wonder.  Someone is betting on a very cold winter by the looks of it.  The DEC-2010 $7 CALLS had a prior open interest of only 6,432 contracts.

SIRIUS XM Radio Inc. (NASDAQ: SIRI) is perhaps more curiosity than it is highly unusual options trading activity off the charts.  Still, a $1.50 stock by many rights is nothing more than a call option in its own right.  Earnings are due this coming week (preview here) and here are the top contracts traded over the coming three months:
NOV-10    Vol.    OpInt
$1.50C    3,634    19,076
$2.00C    4,190    727
$1.50P    1,012    6,054
$2.00P    3,013    250
DEC-10    Vol.    OpInt
$1.00C    1,575    17,505
$1.50C    3,940    31,993
$2.00C    2,102    4,385
JAN-11    Vol.    OpInt
$1.00C    1,128    35,237
$1.50C    2,144    26,394

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JON C. OGG

What is interesting is that options trading is above average.  While volume in the put options has been elevated compared to normal, the trading in the calls is elevated and stands out more on a direct comparison basis.
over 1,100 of the JAN-2012 $1.00 CALLS and over 4,600 of the JAN-2012 $2.00 CALLS.  The MARCH 2011 $1.50 CALLS have seen over 1,450 contracts and the $1.00, $1.50 and $2.00 strikes in the JAN-2011 CALLS have seen more than 5,800 of the combined call option volume.  The DEC-2010 $1.00 calls also saw more than 3,000 contracts trade.

Average volume is about 70 million shares and the prior 52-week range was $0.51 to $1.26.

JON C.OGG

• ALU, ABK, BBI, BGP, BRCD, C, DRYS, FRE, FNM, NOK, PALM, PMI, BPOP, RAD, SIRI, S, UNG, VG

Read full report at 24/7 Wall Street

UPDATE 9:40 AM EST: SIRI is up 2.7% at $1.21 on over 13 million shares in the first ten minutes…. PRICE/VOLUME this morning as follows:

• UPDATE: 9:22 AM EST SIRI is still up 1.9% at $1.20 on about 1.45 million shares traded in the pre-market.
• Shares are up 1.9% at $1.20 on 600,000 shares as of 8:16 AM EST.

That volume is not yet extreme by any measure but this will be key to watch to see how investors and traders position themselves after such a large run-up into the earnings report.

JON OGG

The company also noted that gross additions increased by 29% and deactivations decreased by 11% from a year ago; the self-pay churn improved to 2.0% for the first quarter of 2010 from 2.2% a year ago; and the conversion rate to a self-pay subscription improved in the first quarter of 2010 to 45.2%, up from 44.6% from a year ago.

At 9:10 AM EST shares are up over 7$ and back over the $1.00 mark at $1.03 on over 7 million shares.  The 52-week high is $1.18, so even at $1.00 it has been here before.

JON OGG

Here is the volume of the recent trading days with the closing bell prices:

• 24-Mar-10  162,572,800    $0.88
• 23-Mar-10  122,883,900    $0.87
• 22-Mar-10  237,239,300    $0.86
• 19-Mar-10  180,368,400    $0.83

This stock still is exhibiting a range-bound trading pattern, although we would caution against using any traditional trading analysis in any penny stock.  That is double the case if it is SIRIUS XM.

JON C. OGG

But the realization of an astronomical valuation came back into the limelight after traders and investors realized they had gotten very far ahead of themselves.  John Malone would dwarf Karmazin and have effective control of the company if he were to convert all his debt.

And as shares slid back under the $1.00 mark, the question came up of what was the fair value of SIRIUS XM per share.  Last week we saw very elevated trading volume with one day seeing 309 million shares.  Last week we also saw shares trade briefly under $0.83, but the stock never closed under $0.89 o an adjusted basis.  And after that, we saw it almost hit the buck again at $0.99.

The stock is down 3% today at $0.91+ on over 120 million shares trade with about 45 minutes to the market close.  That isn’t double the normal volume, but is definitely close enough.

This stock may have entered into a trading range now barring any significant stock market event.  Trading as high as $1.18 in Mid-February and as low as $0.83 in early March on no real news is a wide range even for a penny stock.

Imagine if that was seen in Google or Apple.  It would be the talk of Wall Street and Main Street.  Trying to use charts and inflection points in penny stocks or in cult stocks may be more financial alchemy rather than exact science.  But the alchemist approach would look more and more like a solid trading range has been established.

JON C. OGG

OSI Pharmaceuticals Inc. (NASDAQ: OSIP) is soaring this morning after Astellas in Japan said it was commencing a hostile tender offer directly to shareholders.  The $52.00 cash offer is actually under the current price now because holders anticipate that a higher offer will come.  At 8:34 AM EST we have seen 6 million shares trade hands and the stock is up 48% at $55.02.  The 52-week trading range was $27.01 to $39.83.

Ariad Pharmaceuticals, Inc. (NASDAQ: ARIA) is trrading up after it received Orphan Drug Designations for its investigational BCR-ABL inhibitor, AP24534, in chronic myeloid leukemia.  Shares are up 6% at $2.69 on almost 100K shares as of 8:42 AM EST.  The week range is $0.97 to $3.48 and the average volume is 1.7 million shares.

SIRIUS XM Radio Inc. (NASDAQ: SIRI) is down 5% at $0.966 this morning after Wunderlich cut its Buy rating down to Hold.  This was a valuation call as it issued a $1.00 target when it gave its Buy recommendation.  At 8:33 AM EST we have already seen close to 3 million shares trade hands.

Palm, Inc. (NASDAQ: PALM) is up marginally but it might not seem to be after Barron’s said it could down much further and go back toward $3.00 per share.  Shares are up 1% at $6.16 but that is on broad market gains and on traders hoping for a grossly oversold bounce rather than based on any real news.

Millipore Corporation (NYSE: MIL) is shooting this morning.  It got the big buyout it wanted… but from a different suitor.  Merck KGaA of Germany is paying $107 per share plus debt.  The stock is up 11.2%at $105.00 on 1.3 million shares as of 8:38 AM EST.

Pall Corp. (NYSE: PLL) is up in conjunction with Milipore.  This fluids and filtration play has also been thought of as a takeover target.  Thermo Fisher (NYSE: TMO) was supposed to be the Millipore buyer, and then there were rumors last week that 3M Co. (NYSE: MMM) had an interest in Millipore.  Maybe Pal is looking more and more attractive now.  Volume is thin but the stock is indicated up almost 5% at $41.35 as of 8:40 AM EST.

Shanda Games Limited (NASDAQ: GAME) posted a 13% rise in income but it doesn’t look t be pleasing investors.  At 8:44 AM EST we have shares down 12% at $7.28 and the volume is over 250,000 shares.  Its range since last year’s IPO is $7.95 to $13.00.  Today will mark its lowest levels…

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Jon C. Ogg

American International Group, Inc. (NYSE: AIG), a.k.a. Government Insurance, is trading lower after earnings this morning.  The troubled insurer posted an $8.9 billion loss, has curbed a NY Fed repayment plan, and has now said that it may require more government financial assistance.  Shares are down 5% at $26.04 on almost 1 million shares as of 8:45 AM EST.

athenahealth, Inc. (NASDAQ: ATHN) delayed its earnings, and it also said it needed more time to complete reviews and procedures.  It even noted that it would be late with its 10-K and warnings of possible restatements.  Shares were off more than 15% last night and so far this morning we have shares down 11% at $38.73 on about 200,000 shares as of 8:43 AM EST.

CKE Restaurants Inc. (NYSE: CKR) is soaring after it has received a 24% cash premium buyout offer from Thomas H. Lee Partners.  The deal is approximately $928 million including $309 million of net debt; the cash buyout price is $11.05 per share yet shares are at a slight premium for the owner of Carl’s Junior.  After closing at $8.91 and with a 52-week range of $5.65 to $11.52, this one is up 25.5% at $11.18 on over 1.2 million shares as of 8:43 AM EST.

Crocs, inc. (NASDAQ: CROX) is trading lower this morning but above pre-market lows.  We originally saw a 15% drop but the stock looks down almost 9% at $7.10 on about 395,000 shares as of 8:37 AM EST.  The company’s loss narrowed and was actually better than estimates, but its CEO Duerden is stepping down.

Deckers Outdoor Corp. (NASDAQ: DECK) beat earnings yet again last night.  The owner of Uggs and Teva shoes continued over and over to beat earnings expectations.  Shares are up 8% at $114.75 on fairly thin volume this morning.  The 52-week range is $37.24 to $113.10 and average volume is about 445,00 shares.

Palm Inc. (NASDAQ: PALM) is only noted here this morning because of a downgrade and because of yesterday’s meteoric drop.  Palm is up 0.5% at $6.56 on about 200,000 shares as of 8:40 AM EST.

SIRIUS XM Radio Inc. (NASDAQ: SIRI) is trading strong again after yesterday’s earnings, but we would note that SIRI traded up first and then lower on the day Thursday.  The satellite radio monopoly has seen 1% gains this morning on over 2.6 million shares as of 8:48 AM EST.

You can join our free daily email distribution list to hear more about analyst upgrades and downgrades, top day trader and active trader alerts, news on Buffett and other investment gurus, IPOs, secondary offerings, private equity, and more.

JON C. OGG