Learn the trade here. Make it on tradeMONSTER

Options Trading News

December 6, 2012  Thu 3:20 AM CT

EXAS: SEE CHART GET CHAIN FIND STRATEGIES
Exact Sciences got hammered in October, and now the bears are back.

optionMONSTER's Depth Charge monitoring program detected the purchase of more than 4,100 April 7 puts, most of which priced for $0.75. Volume was more than 80 times open interest at the strike.

Those puts lock in the price where shares of the drug developer can be sold. They can appreciate in value if it drops or the market anticipates a decline. Investors use the contracts to hedge existing long positions or as a less-risky alternative to short-selling the stock. (See our Education section)

EXAS ended yesterday's session flat at $9.69. It had peaked at a nine-year high over $12 about two months ago but then tumbled toward $9.

The stock has been lingering below its 200-day moving average since and is now pausing at its 50-day moving average. That could make some chart watchers expect a steeper push lower.

Total option volume was 26 times greater than average in the name yesterday, with puts accounting for three-quarters of the total.
Share this article with your friends


Premium Services

Free Webinar Series

The 100K Challenge

Education & Strategy

Anatomy of a butterfly

One of the many esoterically named option strategies is known as a "butterfly." But don't be fooled: Like other advanced...

View more education articles »
optionMONSTER stockMONSTER tradeMONSTER