Options Trading News

June 17, 2013  Mon 12:20 PM CT

Abercrombie & Fitch is sitting at support, and the bulls are getting long.

optionMONSTER's Heat Seeker monitoring system detected the purchase of 2,500 November 60 calls, most of which priced for $1.41, and the sale of an equal number of November 41 puts for about $1.89. Volume was more than 37 times open interest at both strikes, indicating that new positions were initiated.

The investor collected a credit of $0.48 and now stands to earn unlimited profits with the long calls if the retailer rallies toward $60 by later this year. He or she also stands to lose money to the downside because of the short puts. (See our Education section)

ANF is up 0.76 percent to $49.13 in midday trading and has been spent most of the year consolidating between $45 and $52. It's also holding support at the 100-day moving average, which some chart watchers could view as evidence of a bullish uptrend.

The upside trade pushed overall option volume in the name to almost twice the daily average, according to the Heat Seeker.
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.



The fastest money in the market
View full report »

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 »