Options Trading News

November 28, 2012  Wed 4:18 AM CT

Juniper Networks has been bouncing, and the bulls are looking for more mojo in coming weeks.
optionMONSTER's tracking systems detected the purchase of more than 4,000 December 17 calls, almost twice the previous open interest at the strike and therefore new positioning. Initial blocks priced for $0.53, followed by more chunks that went for $0.64.

Long calls lock in the price where investors can buy shares, so they can generate some nice leverage in the event of a rally. They can also predict moves in the share price because large traders often amass calls before building a position in a stock. (See our Education section)

That happened yesterday as JNPR traded for about $16.90 when the calls hit. Buyers stepped in later in the session, driving shares up 1.67 percent to $17.09 even as the broader market fell in the afternoon. At the same time, the December 17 calls inflated by more than 10 percent to $0.70.

Overall option volume in the maker of telecom gear was quadruple its daily average. Calls accounted for more than 80 percent of the total, a reflection of the bullish sentiment.

(A version of this post appeared on InsideOptions Pro yesterday.)
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I have written a few things on the Covered Call Strategy over the last two weeks. Please understand that those two previous articles plus this one do not constitute a proper, fully in-depth lesson on the Covered Call Strategy like we have in our classes at Option Monster Education. I have picked out a few topics that I believe were worth noting and today I am going to add the final one.

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