Options Trading News

February 21, 2014  Fri 11:32 AM CT

A bullish trade is targeting the SPDR Homebuilders Fund.

optionMONSTER's Heat Seeker system shows that more than 13,500 June 36 calls have traded today, with the biggest blocks bought for $0.42 and $0.43. This is clearly new activity as open interest in the strike was 2,508 contracts before the session began.

Corresponding blocks of the June 28 puts were sold for $0.27 and $0.26 with a total volume of 6,473. Previous open interest in that strike was 15,888.

The trader could either be buying calls and selling puts in a bullish combination spread or shifting from short calls to short puts. Either way, the strategy is bullish. (See our Education section)

The XHB is up 1.14 percent to $32.96 in early afternoon trading. The exchange-traded fund was at a 52-week high of $33.38 at the end of 2013 and rebounded off support at $30.50 at the start of this month.
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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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