Options Trading News

December 12, 2012  Wed 4:45 AM CT

One investor apparently thinks that Autodesk is ready to stage a comeback.

optionMONSTER's Heat Seeker monitoring program detected the purchase of 2,500 January 35 calls for $1.08 and the sale of an equal number of January 35 puts for $1.24. Volume exceeded open interest at both strikes, indicating that a new trade was initiated.

The resulting combination trade is very similar to owning shares in the software company, which has been struggling since the spring. If it they rally, the long calls will appreciate and short puts will lose value, while the opposite will happen to the downside. (See our Education section)

ADSK rose 1.94 percent to $34.62 yesterday. The stock has been trading in a range since May, when it crashed on a weak outlook. The next earnings report in August also lagged estimates, but results started improving in November and shares have been climbing since.

Yesterday's bullish trade pushed total option volume in the name to almost 4 times greater than average, according to the Heat Seeker.
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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.

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