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Options Trading News

January 4, 2013  Fri 4:45 AM CT

IRM: SEE CHART GET CHAIN FIND STRATEGIES
Iron Mountain is breaking above key levels after a two-month slide, and a long-term trade is betting on a rally this year.

optionMONSTER's Heat Seeker system shows that 3,000 January 2014 32.50 calls were bought in one print for $2.75. This is clearly a new position, as the strike's open interest was only 5 contracts at the beginning of the day.

IRM rose 1.78 percent to $32.65 yesterday, crossing above its 50-day moving average a day after closing above its 200-day average. The company, which provides document-management and shredding services, is still down sharply from its 52-week high of $37.70 reached in mid-October but is breaking out of a tight range between about $30.50 and $31.50 in place for the last month.

Yesterday's long calls, which lock in the price where traders can buy shares, are looking for IRM to gain more than 8 percent by January 2014. These in-the-money options could be sold earlier if their premiums rise with any rally before then, but the calls will expire worthless if the stock doesn't rise.

The calls made up most of the 3,856 options traded in the name yesterday, which was more than 15 times its daily average in the last month. Only 196 puts changed hands in IRM, a reflection of the session's bullish sentiment.
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