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October 15, 2012  Mon 10:48 AM CT

ANN: SEE CHART GET CHAIN FIND STRATEGIES
Ann has been pulling back, and the bulls are jumping in.

optionMONSTER's Heat Seeker monitoring system detected the purchase of 2,000 December 36 calls for $2.20, matched against the sale of an equal number of December 41 calls for $0.45 and $0.50. Volume was more than 40 times open interest at both strikes.

The trade cost $1.70 and has the potential to earn a profit of 194 percent if the stock closes at or above $41 on expiration. It's known as a bullish call spread because it leverages a move between two prices. (See our Education section)

ANN is off 0.22 percent to $36.02 today. The New York-based retailer is up 36 percent in the last three months after results beat expectations on Aug. 17. Shares have been consolidating in a range since. They bounced today after testing their 50-day moving average, which could be leading some chart watchers to expect the uptrend to continue.

Overall option volume is 6 times greater than average in the name so far in the session, with calls outnumbering puts by 71 to 1.
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Options Academy: Ron's Risk Calculation--A Real Life Example

It is rare that I get a chance to give a real-life, real-time example in my articles that the readers were not only following but were actually involved in at the time the event is happening. Well, that is where we are right now in our QQQ trade from last week. Let's recap the trade itself.

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