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September 30, 2013  Mon 5:16 AM CT

Traders are looking for Edwards Lifesciences to rebound after its synthetic heart valve won regulatory approval for broader use last week.

About 3,700 October 75 calls were purchased for $0.20 to $0.75 on Friday, according to optionMONSTER's Heat Seeker tracking system. The volume was well above the strike's previous open interest of 1,097 contracts, indicating that this is fresh buying.

These long calls lock in the purchase price for the stock for the next three weeks no matter how far it might rise. They could be sold earlier at a profit if premiums gain with a rally before then, but the contracts will expire worthless if shares remain below the $75 strike price. (See our Education section)

EW closed Friday up 0.31 percent to $68.79. The medical-device maker hit resistance at the $73 level in August and had fallen for last two weeks but is now trying to get back above its 100-day moving average. Last Monday the Food and Drug Administration granted multiple ways for the company's Sapien heart valve to be implanted.

Friday's call buying pushed total volume in the name to 5,883, more than 10 times its daily average for the last month. Overall calls outpaced puts by 5 to 1.

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