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September 18, 2013  Wed 5:16 AM CT

Option activity has been heavy in the energy space for months, and yesterday traders set their sights on Whiting Petroleum.

optionMONSTER's Heat Seeker system showed volume in the September 55 and October 57.50 calls. Traders were rolling positions out in time and up in price from one strike to the other, unloading the 55s for about $0.90 and buying the 57.50s for $1.43. They also snapped up the October 60 calls.

These long calls lock in the purchase price for the stock and can generate significant leverage in a rally, while limiting losses if the shares fall. Rolling the position forward provides an additional month to ride the stock higher, but the new calls will expire worthless if the stock remains below $57.50 through mid-October. (See our Education section)

WLL rose 3.71 percent to $54.78 yesterday. The independent oil and gas company is engaged in exploration, development, and production primarily in the Rocky Mountains, Permian Basin, Michigan, and Gulf Coast regions.

More than 24,000 options traded overall in name yesterday, about 14 times its average amount. Of those, almost 22,000 were calls--a further indication of the session's bullish sentiment.

Disclosure: I own WLL calls.

(A version of this post appeared on InsideOptions Pro yesterday.)
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