Options Trading News

July 3, 2013  Wed 5:59 AM CT

Abercrombie & Fitch has been rebounding, and traders are looking for the comeback to continue.

optionMONSTER's Heat Seeker tracking program detected strong buying in the August 50 calls yesterday for $1.26 to $1.86. More than 4,500 traded in volume well above the previous open interest of 2,944 contracts, indicating that new positions were initiated.

Long calls lock in the price where shares can be purchased, which can provide significant leverage to moves in the underlying stock. But the contracts will expire worthless without a rally by mid-August. (See our Education section)

ANF rose 3.77 percent to $47.93 yesterday. The specialty retailer had rough couple of months in May and June, falling after its last earnings report and then along with the rest of the market. But the stock rose sharply after bouncing at the $44 level last week and is now back above its 200-day moving average.

Total option volume was 5 times greater than average in the session, with calls outnumbering puts by 2 to 1.

(A version of this post appeared on InsideOptions Pro yesterday.)
Share this article with your friends

Related Stories


Bulls shopping at Abercrombie

November 19, 2015

The apparel retailer, which gapped higher after bullish quarterly numbers on Aug. 26, reports its next earnings results tomorrow before the market opens.


Premium Services

Education & Strategy

The art of trading

As I stated in last week's article, a break out or a break down needs to have a couple things happen before it is considered a confirmed break out or break down. The only problem is that in today's market where things move much more quicker than they did just a few years ago, two days could wind up being the majority of the expected movement, if not the whole movement.

View more education articles »