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January 29, 2013  Tue 2:45 AM CT

MDY: SEE CHART GET CHAIN FIND STRATEGIES
The SPDR Midcap 400 Fund hit a new all-time high yesterday, and a volatility trader is now looking for a sharp move in either direction.

More than 11,000 of the MDY options traded on the day, which is about 3 times its daily average. Almost all of the volume was in the March 192 puts.

optionMONSTER's Depth Charge system shows that a trader bought 10,000 of those contracts for the ask price of $1.80. The open interest in the strike was 1,484 before the trade, so this is clearly a new purchase.

Around the same time, a block of 260,000 MDY shares changed hands for $199.1669. So it appears that the stock and options were combined to create a long-volatility position that is looking for the exchange-traded fund to move sharply higher or lower. (See our Education section)

The MDY is slipped 0.15 percent yesterday to close at $199.34 after hitting $199.99 earlier in the session, a new lifetime high. It has been on the rise from support at $172 since mid-November.
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Market Level Making You Nervous, Huh? Part 3

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