Market News

January 23, 2013  Wed 4:45 AM CT

Synaptics is attracting bullish option activity ahead of its earnings report tomorrow.

More than 2,500 February 33 calls traded in a strong buying pattern yesterday afternoon, with premiums rising from $1.25 to $1.40, according to optionMONSTER's Heat Seeker tracking system. The volume was nearly 5 times higher than the strike's open interest of 520 contracts before the day's trading began, clearly showing that these are new purchases.

SYNA fell 0.64 percent yesterday to close at $32.76. The company, which makes touchpads and other parts for computers and mobile devices, has been climbing sharply from support around the $23 area in the last two months. Its chart has shown increasingly bullish signals, most recently last Thursday when its 50-day moving average rose through its 200-day line, as noted on researchLAB.
Yesterday's long calls, which lock in the price where traders can buy shares, are looking for SYNA to climb roughly 5 percent or more by mid-February. But if the stock is below the $33 strike price at that time, these options will expire worthless.

The February 33 calls made up almost all of the 2,676 total option volume in SYNA, which was more than 11 times its daily average for the last month. Only 65 puts changed hands in the entire session, a reflection of the day's bullish sentiment.

The company is scheduled to announce results for its fiscal second quarter tomorrow at 5 p.m. ET.
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