Learn the trade here. Make it on tradeMONSTER

Options Trading News

December 19, 2012  Wed 2:14 AM CT

KWK: SEE CHART GET CHAIN FIND STRATEGIES
Quicksilver Resources has seen its stock price cut in half this year, and a long-term trade is positioning for another steep drop.

optionMONSTER's Depth Charge system shows that 4,100 January 2014 3 puts were purchased for $0.85, led by single print of 3,800 contracts. The volume was 12 times the strike's open interest of just 348 contracts at the beginning of the day, so this is clearly fresh buying.

The put buying wasn't tied to any stock trades identified by our systems yesterday, but they could have been a hedge on a long position established earlier. If not, the trader could be making a straight bearish bet that KWK will plunge roughly 37 percent by expiration in 13 months. (See our Education section)

KWK rose 0.89 percent to close yesterday at $3.40 after hitting an intraday high of $3.57. The shares touched their 50-day moving average in the session for the first time since late October before pulling back. The independent oil and gas company came into 2012 above $7 but has been trending lower all year.

Total option volume in the name was 7 times its daily average for the last month. Puts outnumbered calls by 11 to 1, an indication of the session's bearish sentiment.
Share this article with your friends


TRADING WEEKLY OPTIONS

The fastest money in the market
View full report »

Premium Services

Education & Strategy

Options and high-frequency trading

There has been much talk lately of high-frequency trading (HFT) and what it does--or doesn't--mean to the markets and retail...

View more education articles »
optionMONSTER stockMONSTER tradeMONSTER