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January 26, 2012  Thu 2:16 AM CT

NUAN: SEE CHART GET CHAIN FIND STRATEGIES
iPhone technology supplier Nuance drew upside option activity yesterday as Apple's shares spiked higher on its blockbuster earnings numbers.

optionMONSTER's Heat Seeker system shows that 3,366 July 29 calls were bought for $0.40 in less than 5 minutes yesterday. That volume dwarfed the strike's previous open interest of just 130 contracts, indicating that these calls were opening new positions.

It was the second time that NUAN has seen bullish option trading in recent weeks. The name saw heavy buying of its February 28 calls on Jan. 11.

NUAN closed yesterday off 0.14 percent to $27.95 but crept back up in after-hours trading. The stock bounced from below $23 on "Black Friday" after Thanksgiving and hit a 52-week peak of $29.78 on Jan. 18, but it has fallen since then.

For yesterday's long calls to turn a profit, the shares would need to gain at least 5 percent by expiration in mid-July. (See our Education section)

Nuance powers the popular Siri voice-recognition technology in the iPhone 4S. The company is scheduled to report earnings on Feb. 9.

Nearly 9,000 options traded in the name yesterday, more than 2.5 times its daily average. Overall calls at all strikes outnumbered puts by more than 11 to 1, a reflection of the session's bullish sentiment.
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Education & Strategy

The Strike-Based Greeks

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