OptionsHouse

Options Trading News

November 29, 2012  Thu 10:06 AM CT

LOW: SEE CHART GET CHAIN FIND STRATEGIES
One investor is betting that Lowe's will keep going and going.

optionMONSTER's Heat Seeker monitoring system detected the purchase of about 10,000 December 36 calls for $0.93 and the sale of an equal number of December 34 calls for $2.36. Volume was below open interest in the 34s, indicating that an existing position was closed and rolled to the higher strike.

The investor collected a credit of $1.43, thereby recovering most of their capital locked up in the trade. He or she now remains positioned for further gains in the next three weeks if the home-improvement stock continues to rally. (See our Education section)

LOW is up 0.67 percent to $36.01 in morning trading. The stock is up 48 percent so far this year amid improved sentiment toward housing and is now making new all-time highs. Earnings and revenue beat expectations earlier this month, and management said demand for building materials was strong in the wake of Hurricane Sandy.

Total option volume is more than twice the daily average so far today, with calls outnumbering puts by 18 to 1.
Share this article with your friends


Related Stories

LOW

Lowe's trader builds highly bullish play

May 23, 2016

A combination trade is looking for more gains in the home-improvement retailer, which raised its outlook while beating quarterly estimates last week.

OptionsHouse

Premium Services

Education & Strategy

Timing the Trade

Both break outs and a break downs need to have a couple things happen before it is considered a confirmed break out or break down by technical definition!  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.

View more education articles »