Overstock.com (OSTK) rallied more than 30 percent on earnings Thursday and is up another 7 percent to $18.08 today. In the options market, bullish trading is being seen as well, with 3321 calls traded, or 3x the recent avg daily. The action is focused on April 15, 17.5 and 20 calls. June 20 calls are seeing interest as well and implied volatility is up about 7 percent to 55. OSTK reported its first ever annual profit last Wednesday and, in the conference call, CEO Pat Byrne lashed out on short sellers, “crooked” hedge funds and regulators. “We’ve got a group of parasites who have found a loophole that they can keep on using to just drain resources out of entrepreneurs in America, and in the process kill small companies,” accordting to Byrne. He’s filed lawsuits (link to story.)

Some less actively traded names seeing bullish order flow: Informatica (INFY), GTX Inc (GTXI), Aruba Networks (ARUN) Bearish order flow: NCR, Knight Transportation (KNX), Barry Pete (BRY) Post-Earnings: Overstock.com (OSTK), SAIC (SAI), SmartHeat (HEAT) Pr-Earnings: Research In Motion (RIMM) Ex-div.: Toronto Dominion Bank (TD), Raytheon (RTN)

Overstock (OSTK)Overstock (OSTK) saw the June $10/$15 straddle sold 750 times yesterday. The net debit was $1.25 and this was an opening position. Since the company reported earings on April 22 IV has declined from 105% to 84% which is low end of 52 week range. Stock has traded between $11 and $13 for past three weeks settling at $12.52 on Tuesday

Overstock.com (OSTK) is up 25 cents to $10.61 and options volume is running 4X the usual. 1,550 April 12.5 calls traded so far. The top two trades are 401 and 392 contracts at the offer for a dime. Most of the volume has been in smaller size and also hitting ask-side for a dime. Existing open interest is 1,292. Open buys in the April 12.5 calls seems unsual, as the contract is 17.8 percent out-of-the-money with 2.5 trading days of life remaining. Earnings are expected around April 17, but that date has not been confirmed and is not yet posted on the company’s web site.

Overstock.com (OSTK, news, chart, volatility) puts are active ahead of earnings. The stock is down 59 cents to $10.95 and volume in the options market is running five times the average daily. 3,000 puts and 381 calls have traded. The January 10 puts are the most active, with 2,500 traded. The top trade of the day is an order for 287 contracts traded bidside for $2.65 a contract. Outside of that, the activity has been mostly in smaller size, with a little more than half the day’s volume trading on the offer. Therefore, while OSTK options volume is much higher than typical levels and puts are dominating the action, sentiment seems mixed. Implied volatility is up to 140, compared to about 115 the day before. Earnings due out Thursday before the opening bell.

Overstock.com (OSTK, news, chart) calls are active on dubious chatter that Amazon.com (AMZN) might be eyeing the company. Shares are up 17 cents to $20.06 and 5,275 OSTK calls have traded, compared to 792 puts. The August 22.5s, which come off the board a week from Friday, are the most actives. 3,975 contracts have traded, with 65 percent of today’s volume trading offerside.

Implied Volatility Gappers (+) AGO, NAK, TZIX, SFI, FRE, FNM, MER, LM, ACAS, SAF, OPWV, PHH IV Gappers (-) NFLX, BRL, VEA, FDRY, TLAB, ROH, APPX, INTU, OEF, MFA, QLTI Rich (High IV/SV) TZIX, EVVV, FXEN, IOC, OMI, ALGN, HTCH, ELN, ITMN, NWY Cheap (Low IV/SV) BXG, FCSX, FED, OSTK, HBAN, UAUA,CDNS, FDRY, FHN, ARTC