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January 16, 2013  Wed 9:42 AM CT

Onyx Pharmaceuticals has given back much of its gains from the first days of 2013, but one trader is betting on a floor beneath the stock.

optionMONSTER's tracking systems detected the sale of 2,500 May 70 puts this morning for $2.75. The volume dwarfed the strike's open interest of just 79 contracts at the start of the session, clearly showing that this is a new position.

ONYX is down 3.13 percent to $80.82, a day after announcing that a secondary stock offering. That move led R.W. Baird to cut its price target on the name to $96 from $99 this morning, though the firm maintains an "outperform" rating on the stock.

Shares of the biopharmaceutical company began 2013 with a strong rally but hit resistance at the $86 level last week and have been falling since then. The company is scheduled to report fourth-quarter and full-year results after the close on Feb. 21.

Today's put seller is looking for the stock to close above the $70 strike price at expiration in mid-May. If ONYX is below that level, the trader will face the obligation to buy shares at an effective price of $67.25 once the credit from the put sale is included. That is near support levels going back to mid-July. (See our Education section)

Total option volume in the name is already double its full-session average for the lats month.
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