Marvell Tech bulls are back for more
Mike Yamamoto | [email protected]
optionMONSTER's Heat Seeker system detected the purchase of 2,000 January 12 calls in one print for $0.98. The volume was more than triple the strike's open interest of 593 contracts before the trade appeared, showing that this is fresh buying.
The trades followed bullish call buying in the name on Friday in the July 12 strike and in the Weekly 10.50 contracts that expire at the end of this week.
MRVL fell 0.8 percent yesterday to close at $11.15. The chip maker had been falling since hitting a recent high of $11.90 on May 24 but bounced off its 50-day moving average last week.
The calls bought yesterday lock in the purchase price for the stock at $12.98 no matter how far it might rise, potentially providing significant leverage in a rally while limiting risk if the shares drop. But if MRVL remains below the $12 strike price through mid-January, those contracts will expire worthless. (See our Education section)
Total option volume in the name topped 11,700 contracts yesterday, 50 percent higher than its daily average for the last month. Calls outpaced puts by 1.5 to 1.
The company is scheduled to present at the Lazard Solid State Storage Day conference tomorrow.