OptionsHouse

Options Trading News

February 6, 2013  Wed 9:13 AM CT

AMAT: SEE CHART GET CHAIN FIND STRATEGIES
Applied Materials is pulling back from yesterday's highs, but one trader is betting that the chip-equipment maker will hold current levels in coming months.
 
optionMONSTER systems detected the sale of 3,000 April 13 puts for the bid price of $0.46 today. The volume was more than double the strike's open interest of 1,701 contracts before the session began, indicating new activity.

The put selling is based on the thesis that AMAT will remain above $13 through that April expiration. The trader is willing to buy shares if they fall below that price and they are assigned. (See our Education section)

AMAT is down 0.86 percent to $13.31 this morning, a day after posting its highest close since the middle of 2011. Shares have run up from support at $10 since the middle of November and broke through resistance at $13 just last week.
Share this article with your friends


OptionsHouse

TRADING WEEKLY OPTIONS

The fastest money in the market
View full report »

Premium Services

Education & Strategy

Timing the Trade

Both break outs and a break downs need to have a couple things happen before it is considered a confirmed break out or break down by technical definition!  The only problem is that in today's market where things move much more quicker than they did just a few years ago, two days could wind up being the majority of the expected movement, if not the whole movement.

View more education articles »