SPDR Technology Fund shares are up 13c to $21.60 and seeing a continuation of what is potentially bullish positioning in the June calls though not on the scale of previous sessions. Today’s action sees the $23 and $24 strikes each trade approximately 15,000 contracts in what could be roll down. The $24 call had seen heavy buying on 5/17 (see market color) and open interest swelled to some 140,000 contracts. This position was apparently partially rolled down to the 23 strike ( see market color 5/20) and OI is now down to 119,000 in the 24s and u to 85,000 in the 23s.

The top options trades so far today are Citi (C) Dec 4 straddles at $1.36, traded on the bid, 30000X on PHLX. It might close an existing position or possibly a bet that Citi will stay within a range around these levels between now and the December expiration. Citi is up 15 cents to $3.91. Implied volatility has fallen about 9.5 percent to 57, down from a multi-month high of 70 last Thursday.

*Scanning all single-stocks subject to 2500 contracts minimum call or put volume

Notable activity in December as $9 puts and $17 calls each trade 4,750 contracts in what looks like bearish risk-reversal (buying puts, selling calls, for a one-cent debit). The $9 puts have now traded a total a total of 10,000 contracts and the $16 call is also showing volume of 5,100 contracts all done in relatively small multi-hundred lots in possibly a $9/$16 risk-reversal. Based on prior OI all appear to be new positions.

Legg Mason (LM) options volume was 5X average Friday due to 1 large bearish risk reversal for 5,500 contracts in August. The trader sold the August $35 calls and bought the August $25 puts for a net debit of $0.30, shares at $30, betting on at least a 16% fall in shares in coming months. Shares formed a potential double top around $34 and financial reform could hurt results going forward. The asset manager trades at a PEG of 3 and 0.85X book value. Shares are already trading near most Street targets, so downgrades could occur. The Company recently announced the successor to Bill Miller, a legend, so there could be some loss of faith in the Company and clients could move elsewhere. April AUM (Assets Under Management) was $685.3B, no growth from the prior month.

Cautious trading is expected as the euro slides and investors await the day’s economic data. Less than thirty minutes before the opening bell on Wall Street, index futures indicate that the Dow Jones Industrial Average might lose 35 or 40 points at the open.

Stocks traded mixed in Asia and are lower across Europe before the exchanges opened in New York. Japan’s Nikkei edged down .2 percent, but Hong Kong’s Hang Seng rose .6 percent. Germany’s DAX fell 1 percent and is pacing the decline across the euro-zone.

Concerns about the European Debt Crisis persist and those worries at being reflected in the falling euro, which is down .0165 to 1.2380 against the buck Monday morning. The dollar edged up .21 to 90.40 against the Japanese yen.

Meanwhile, after big gains last week, the rally in bonds continues ahead of existing home sales data. The benchmark ten-year Treasury is up 16/32nd and now yields 3.17 percent.

Economists expect the report, due at 10:00 am ET, to show home sales up to an annual rate of 5.65 million in April, from 5.4 million the month before.

Some of the commodity related names might see early strength after crude oil added 45 cents to $70.49 a barrel and gold gained $12 to $1188.1 an ounce.

Among the other stocks to watch, Sprint Nextel (S) is up 5 percent after Goldman Sachs upgraded shares to buy. BP lost 3.5 percent after the oil slick continued to grow and some reports indicated that the government could step in to takeover clean up efforts. The earnings calender is light this week, but Medtronic (MDT) and Autozone (AZO) might see action today ahead of earnings, tomorrow before the bell.

Some less actively traded names seeing bullish order flow: Lawson Software (LWSN), Dollar General (DG), ProShares Ultra Short Gold (GLL) Bearish order flow: Tyco Electronics (TEL), EZChip Semiconductor (EZCH), Zymo Genetics (ZGEN) Post-Earnings: Dell Computer (DELL), Marvell Tech (MRVL), Brocade (BRCD), Salesforce.com (CRM) Pre-Earnings: Yingli Energy (YGE) Ex-div.: Alcon (ACL)

*Scanning all single-stocks subject to 2500 contracts minimum call or put volume