Options in Play: American Axle and Ford Motor Company

Unless you spent the 1980s holed up in a cave, today's two focus stocks -- American Axle & Manufacturing Holdings, Inc. (AXL) and Ford Motor Company (F) -- might call to mind the super-catchy theme of Beverly Hills Cop. "Axel F," anybody? No? Just me? Well, in any event, both auto-related issues are racking up noteworthy option volume in today's trading.

AXL is attracting attention in the wake of its second-quarter earnings report, which hit the Street this morning. The auto parts company topped analysts' profit and revenue expectations, and the stock is up more than 6% as a result. Now, AXL is poised to notch a weekly close above its 20-week moving average for the first time since April 30.

Put volume on the equity has ramped up to 13 times the norm today, with nearly 5,300 contracts crossing the tape so far. Most active is AXL's out-of-the-money January 2011 7.50-strike put, with 5,000 contracts changing hands. These aren't necessarily bearish bets, though -- earlier, a block of 2,055 contracts traded closer to the bid price, indicating they may have been sold.

Puts are also the options of choice on Ford today, with volume climbing to 1.47 times the expected level. Roughly 37,000 puts have crossed the tape so far, and most of the action is taking place in the automaker's front-month series. The August 12 put has seen 9,258 contracts trade, with 75% crossing at the ask price -- indicating they were purchased.

Shares of Ford are 1.5% lower this afternoon, but the stock is simply consolidating some gains. The stock is hovering comfortably above the $12.50 region, which is the site of a recent bullish gap, as well as F's rising 10-day moving average. Going forward, this level could prove to be key support for the security -- much to the dismay of today's put buyers.

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