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June 19, 2012  Tue 9:30 AM CT

SWKS: SEE CHART GET CHAIN FIND STRATEGIES
The bears want to pounce on Skyworks Solutions as the chip maker struggles with a resistance level from earlier in the year.

optionMONSTER's Depth Charge monitoring system detected the purchase of about 2,500 August 29 puts for $2.85. Volume is more than 7 times open interest in the strike.

SWKS is up 0.71 percent to $28.46, back around the same price area where it peaked in March. Today's put buyer apparently thinks that sellers will come forward at this level once again and drive the stock lower.

The trader is using in-the-money contracts, which will closely track declines in the share price. They're more expensive than out-of-the money options and reflect a stronger bearish conviction. (See our Education section)

The company's results have beaten expectations for at least the last four quarters. The date of the next report for its fiscal third quarter hasn't been announced, but last year it was on July 21.

Overall option volume in SWKS is almost twice the average amount so far today, with puts outnumbering calls by more than 3 to 1.
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Market Level Making You Nervous, Huh? Part 3

In last week's article, we discussed how important the extra cash you save by using the Stock Replacement Strategy over buying the actual stock is! That extra cash in our account instead of being unnecessarily tied up in a stock position allows us to buy the puts we would need to protect our downside in the case of a major sell-off.

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