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Oh sure, it feels nice, but some options pros are looking at Friday's market rally with a jaundiced eye.

One of those options pros is Rod Jamieson, vice president of options at

First Union Securities

, who's looking at Friday's advance cautiously. He said he doesn't think the market has seen the big panic or capitulation that more often than not marks a market bottom. "I'd like to see a final washout," he said.

Some other market analysts would like to see a few more things happen too before deciding the market has bottomed.

Bernie Schaeffer, Chairman and CEO of

Schaeffer's Investment Research

, wrote Friday that "there can be no 'all-clear' signal for a market bottom unless and until we get at least one VIX close below 30."

The VIX is the

Chicago Board Options Exchange Volatility Index

. It's an indicator that some watch as a gauge of the market's anxiety level. (Generally, the VIX rises when put options buying increases on the

S&P 100

, or OEX.) A put option is a type of option that gives the purchaser the right but not the obligation to sell a security for a specified price at a certain time. Typically investors buy puts to either speculate on a downdraft in a stock or index price, or to use the option as protection against a long stock position.

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Currently, the VIX is still planted above 30, indicating that perhaps there's still another swing lower yet to come. The VIX dropped a healthy chunk Friday, falling 5.34% to 33.15.

For contrarians, low readings on the VIX are bearish, while high readings are bullish. During the April selloff, the VIX spiked as high as 41.53. The signs of continued fear, for contrarians, is good news. The worse the sentiment on stocks, the closer the market is to turning a corner and rallying, or so contrarian theory goes.

Some options pros watch the VIX with a skeptical eye, however, because volume in OEX options has declined significantly over the past few years, suggesting to many that the VIX may not be as reliable a sentiment indicator as it used to be. Nevertheless, many stock and option market pros still keep a close eye on the VIX as a measure of sentiment.

The CBOE said it set a new volume record Thursday when its year-to-date volume surpassed last year's total. At the of end of trading Thursday, year-to-date volume stood at 255.3 million options contracts, while total volume for 1999 was 254.3 million, the exchange said.

The volume leaders at CBOE this year have been options on

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