Learn the trade here. Make it on tradeMONSTER

Options Trading News

May 6, 2014  Tue 4:13 AM CT

CTXS: SEE CHART GET CHAIN FIND STRATEGIES
For the second time in less than a week, traders are looking for a rally in Citrix Systems.

optionMONSTER's Heat Seeker monitoring program detected the purchase of 5,000 June 62.50 calls for $0.97 and the sale of an equal number of June 65 calls for $0.44 yesterday. Volume was below previous open interest in the higher strike, leaving two possible explanations for the activity.

One is that new money was put to work in both halves of the transaction. In that case, it was a bullish call spread with the potential to earn 372 percent from a rally to $65 by expiration seven weeks from now.

Alternatively, the trader might have rolled a long-call position down to the $62.50 strike, almost doubling the position's delta from 0.15 to 0.29 and increasing upside leverage. Either way, he or she paid $0.53 and is bullish on the name. (See our Education section)

CTXS rose 0.44 percent to $59.26 yesterday and has been bouncing along the lower end of its trading range for the last two years. The cloud-software company's earnings and revenue beat expectations on April 23, which could make some traders expect more upside in coming weeks.

Overall option volume in the name was more than triple its daily average for the last month, according to the Heat Seeker, with calls accounting for 77 percent of the total. Citrix also saw bullish option activity on April 30.
Share this article with your friends


Related Stories

CTXS

Trader shows confidence in Citrix

September 10, 2014

One trader apparently believes that shares of the cloud-software company will hold firm through the end of next week.

Premium Services

Free Webinars

Swing Trading w/ Jon Najarian and Ron Ianieri

Education & Strategy

Make your rules, and stick by them!

New traders often act on the recommendations of others or on gut feel. But that is a quick way to...

View more education articles »
optionMONSTER stockMONSTER tradeMONSTER