Learn the trade here. Make it on tradeMONSTER

Options Trading News

June 12, 2013  Wed 4:45 AM CT

A: SEE CHART GET CHAIN FIND STRATEGIES
Agilent Technologies has been consolidating after a big move, and now the bulls are back.

optionMONSTER's tracking systems detected the purchase of 10,000 November 47 calls for $2.10 and the sale of a matching number of November 41 puts for $2.02. Volume was more than 80 times the previous open interest at each strike, indicating new activity.

The put sale generated income, lowering the cost of the long calls to just $0.08. That creates the prospect of massive leverage if the maker of scientific equipment pushes higher by the autumn, but it also creates the risk of significant losses with the short puts. (See our Education section)

A fell 0.56 percent to $44.48 yesterday. It gapped higher last month after a strong earnings report and touched its highest price in 22 months before retreating along with the rest of the market.

The stock is now trying to hold the same range that had been resistance from early 2012, which could be leading some chart watchers to think that it will continue to rally. Yesterday's combination trade effectively programs a buy order at $41 if it tests that level. Given that the trader likes the name, he or she would probably be willing to own it for that price as well.

Total option volume was more than 11 times greater than average in the company during the session.
Share this article with your friends


TRADING WEEKLY OPTIONS

The fastest money in the market
View full report »

Premium Services

Archived Webinar

Make Money in a Volatile Market

Education & Strategy

Anatomy of a butterfly

One of the many esoterically named option strategies is known as a "butterfly." But don't be fooled: Like other advanced...

View more education articles »
optionMONSTER stockMONSTER tradeMONSTER