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May 30, 2012  Wed 11:08 AM CT

CSC: SEE CHART GET CHAIN FIND STRATEGIES
Sellers pounded Computer Sciences earlier in the year, and they're still looking for lower prices.

optionMONSTER's Depth Charge monitoring system detected the purchase of about 3,200 September 22.50 puts for $1.20 and the sale of almost 2,800 June 22.50 puts for $0.15. Volume was below open interest in the June contracts, indicating that an existing position was rolled forward by three months.

That gives the investor more time to profit from downside in the software company. He or she also increased the size of the bet and put more money behind the trade, which shows their conviction.

CSC fell 1.17 percent to $26.98 in early afternoon trading and has been languishing around its current levels since last summer. It attempted to rally in February after an upbeat earnings report but came back to earth after hitting resistance at its 200-day moving average. The last release in May was poor, hampered by weak government spending in the United States and Europe.

Today's put buyer may be using the contracts as a hedge on a long position or could be looking for downside in the stock. Rolling the position today spared the trader from the accelerating pace of time decay that will affect the June puts over the next two weeks. (See our Education section)

Overall option volume is 7 times greater than average so far, with puts outnumbering calls by a bearish 330-to-1 ratio.
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