Bulls aiming to connect with Juniper
David Russell | [email protected]
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.)