OptionsHouse

Options Trading News

August 11, 2014  Mon 3:27 AM CT

DKS: SEE CHART GET CHAIN FIND STRATEGIES
Dick's Sporting Goods has pulled back to long-term lows, and the bulls are piling in.

optionMONSTER's Heat Seeker monitoring program detected the purchase of more than 7,000 September 43 calls, most of which priced for $1.15 to $1.40. Volume was almost 3 times previous open interest at the strike, so new money was put to work on the long side.

Calls lock in the price where investors can the specialty retailer, letting them cheaply profit from a rally. They can also generate significant leverage if shares move in the right direction. (See our Education section.)

DKS rose 1.43 percent to $42.50 on Friday, but is down 27 percent so far this year. Most of that drop came after earnings and revenue missed expectations on May 20. Despite the selling, shares are now back to the same price range where they peaked in 2011. Last week's buyers apparently think they're ready to bounce. researchLAB also shows retailers and consumer-discretionary stocks outperforming the broader market recently.

Overall option volume was 9 times greater than average in the session, with calls accounting for more than 780 percent of the total.
Share this article with your friends


Related Stories

DKS

How the bears are playing Dick's

January 2, 2015

The retailer is back to a key level from May, and now traders think it may head lower.

Invest Like a Monster - Las Vegas: March 13-14

TRADING WEEKLY OPTIONS

The fastest money in the market
View full report »

Premium Services

Free Webinar

Option Money Machine Winter Classic

Education & Strategy

The rolling technique

In the January 7th edition of Advantage Point, we initiated the purchase of a second week-out GOOGL 535 put at...

View more education articles »